Q1) Consider the new Keynesian Phillips curve with indexation, under the assumptions of perfect foresight and = 1, together with our usual aggregate demand equation, y_t = m_t - p_t. (a) Express p_t+1 in terms of its lagged values and m_t. (b) Consider an anticipated, permanent, one-time increase in m: mt = 0 for t < 0, m_t = 1 for t 0. Sketch how you would find the resulting path of p_t.