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QUESTION ? Suppose the economy of Ghana in 2015 is characterized by C - 400 + 0:75(Y-D) 1 - 400 - 20r G - 200 T - 200 M' - 250/P M - 0 25Y - 10r a) Derive the equations that describe the IS and LM curves. [4 marks] b) Find and interpret the slopes of the curves above. Give a brief explanation as to why they are positively or negatively sloped. 13 marks] c) Calculate equilibrium output and interest rates (in this case assume P=]) 13 marks] d) Derive the aggregate demand equation and interpret its slope. (4 marks) e) Given an aggregate supply curve of the following form Y-2300, find equilibrium price and output in Ghana [3 marks] () Suppose under a reform programme the government of Ghana in November 2015 reduced spending by #50m (50 units), what will be the new equilibrium price and output? [3 marks] g) With the aid of IS-LM diagram explain how equilibrium income and interest rate are affected by the policy in part (f) above [5 marks]