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v for Students NOW D Question 9 or Code Suppose we assume that initially a = 0, b = 0.5, R, = F = 5%; ifac rises 2 percent and the real interest rate falls 2 percent, short-run output: rces rises 1 percent. falls 2 percent. does not change. falls 1 percent. rises 3 percent. PreviousGuide APNow for Students Using RPNow D Question 7 WPC Honor Code Refer to the following figure when answering the following questions. Tutoring Figure 11.6: IS Curve Student Resources Time in AZ SU Bookstore Library thinking Online ISa $1 Consider the IS curve in Figure 11.6. If the interest rate increases and there is a positive aggregate demand shock, the economy would move from point e to point: O d. Ob. a O C. Of. Previousw for Students PNOW D Question 6 or Code Using the neoclassical model of consumption, an implication of the permanent-income hypothesis is because urces no borrowing; income in the future is higher that wealth is constant; real interest rates are, more or less, constant a low discount factor; of the borrowing constraint that permanent income follows a random walk; of aggregate demand shocks consumption smoothing; of diminishing marginal utilityStudents W D Question 8 ode One of the implications of the intertemporal budget constraint is that: All of these answers are correct. None of these answers is correct. lifetime consumption equals total wealth. current consumption does not have to equal current income. there can be income transfers between today and the future. Previousfor Students Vow D Question 10 Code Which of the following is the mission of the Federal Reserve Bank? 1. Preserve price stability es //. Foster economic growth and employment ili. Ensure taxes are fair i/ only i and fil i only iii only i and if Previous