Mouse #1: Suppose members in OPEC [an oil cartel] effectively collude and increase profits by restricting global oil production and increasing the market price of oil. This leads to an adverse supply shock for Denmark and Argentina. Assume both countries were at identical equilibrium levels of price and output before the supply shock. The central bank of Denmark. believing in the power of market corrections. takes no action to stabilize their economy. Dbserving the cartel's market impact in the short run. Argentina's central bank increases the money supply to immediately return the economy to full employment. a] {3 points} Relative to the initial equilibrium before the supply shock. describe the short-run impact of the cartel's action on prices and output for 351; country. Use the ADI-AS model to illustrate these changes {label all curves and equilibrium points and variables of interest}. b] [3 points] Relative to the initial equilibrium before the supply shock. describe the Igpg impact of the cartel's action on prices and output for e311. country after their central bank decisions. Eontinue using your previous AD-AS diagrams to illustrate these changes. Label and describe any changes. :1 [4 points: Comparing the different central bank decisions across Denmark and Argentina. use the prior All-AS equilibrium results to discuss the strengths and weaknesses ofArgentina's stabilization policy compared to Denmark's nor-action policy. Free-Regrponse #2: In the nation of Eamunda. the aggregate production function is given by the equation: T=KimllLElml While the current savings rate is 30%. capital depreciates at a rate of 35%, population growth is 4%. and technological growth is its. a] {3 points]I Find the steadyvstate levels of capital per effective worker. output per effective worker. and consumption per effective worker. Show all work. {Round answers to two decimals. if necessary] b] [4 pointsl Calculate the Golden Rule level of capital per effective worker. What optimal savings rate is necessary to achieve the Golden Rule equilibrium? Show all work. {Round answers to two decimals. if necessary] Cl [3 poinlsl Discussing the economy at town hall with voting constituents, a politician recalls from their undergraduate economics course that a way to stimulate growth with a current steady-state capital stock below the golden rule level is to increase the savings rate. Comment on the politician's logic and why some constituents might be against this policy change. Justify your thoughts