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Solve in details Suppose that the economy is given by the following equations: IS: yt = Ey - (rt - T) MP: = + (

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Solve in details

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Suppose that the economy is given by the following equations: IS: yt = Ey - (rt - T) MP: = + ( nt - 7 ] ) + y PC: Suppose that the central bank is targeting a 3% inflation rate and the natural interest rate is 0%. What size output shock will push the economy into a liquidity trap

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