Question 3 [5 marks] The following are variants of reducedform AD and Phillips Curve, respectively. Pr=rrUrrlY,+o1Mr Pr=l 1.1 ][,81{ irrnjjupm Assume: Autonomous AD components is $15m and income elasticity of 115. The money supply {M} is $Sm with its elasticity of 0.3. Also assume {it} is estimated as [LEI] and speed at which the price level responds to output gap is 0.5. Potential output [Y*] is $1Em. previous year's price level index is 211'} and {t} is time subscript. [a] Compute the equilibrium level of real GDP {b} Compute the rate of ination of the current year [t] {Yr-1"\")- {c} Explain what mdicate for monetary policy