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The attached problem Consider the following numerical example of the lS-LM model: c = 244+0.52YD l =154+0.22Y1,150i G=273 T=213 i=0.05 Derive the [S relation. (Hint:

The attached problem

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Consider the following numerical example of the lS-LM model: c = 244+0.52YD l =154+0.22Y1,150i G=273 T=213 i=0.05 Derive the [S relation. (Hint: You want an equation with Yon the left side of the equation and everything else on the right.) Y: D - Di. (Round your calculations of the intercept and slope terms to two decimal places.) The central bank sets an interest rate of 5%. In the equations given above, this decision is represented as i = D and is known as the D relation. Given this model's l8 and LM equations. the equilibrium real output. Y, is D (Round your response to the nearest integer.) Use the expression given below along with the values of equilibrium real output and the interest rate to determine the level of the real money supply. M 23V 7082' =. -, l P The real money supply is D. (Round your response to the nearest integer.)

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