1. The demand curve and supply curve for one-year discount bonds with a face value of RM1,000 are represented by the following equations:

B_d: P = -0.8Q + 1100

B_s: P = Q+ 680

Where P = Price, Q = Quantity

1. Calculate the expected equilibrium price, quantity and expected interest rate of bonds in this market
2. A natural disaster causes severe damage to residential areas, bridges and highways, leading to increased government investment spending to repair the damaged infrastructure. Based on the answer in a),explain what will happen to the equilibrium level of interest rate.