Mankiw and Summers (1986) find that the estimates of the money demand function based on disposable income, Y - T, outperform those based on income, Y. As a result, they propose the following money demand schedule, MP = (Y - T) L (i). The version of the IS-LM model associated with this money demand function is given by, IS curve: Y = co+ q(Y - T)+I(r)+G, LM curve: M/ P = ( Y - T) L(r + me ). Using this alternative version of the IS-LM answer the following questions c) What are the effects on output and the real interest rate of a tax cut in this modified version of the model? Derive your results graphically. d) Derive analytically the effect of the tax cut on output and