Calculate and show the equilibrium output and interest rates

Assignment Help Macroeconomics

Reference no: EM131519205

Assignment

1. Using the IS/LM model, AD/AS, the Asset Market:

Goods Market:                Money Market:
C=250 + 1/2(Y-T)           M/P=450
I=150-500r                    L(r,y)=.5y-500r
G=100                           Long-Term Inflation: 3%
T=100                           Natural Rate of Unemployment: 4%

a. What are the IS and LM equations if the price level is 100?

b. Calculate and show the equilibrium output and interest rates?

c. Considering a Keynesian Model, show graphically what happens to P, Y, and r in the SR when the Federal Reserve conducts an open market sale of 4500.

d. What is the short run Y and r?

e. Suppose instead the government conducts a balanced budget expansion of 120 units. Redo d and e.

Reference no: EM131519205

Questions Cloud

Explain the single factor or combination of factors : Explain the single factor or combination of factors that you view as having the most influence on personality

Kinds of automobiles with shared properties : This simplified concept of cars and trucks both being kinds of automobiles with shared properties and individual properties helps to explain the relationship.

What is the value today of a stream of cash flows : What is the value today of a stream of annual cash flows paying $500 at the beginning of each of the next 8 years (i.e. the first cash flow will occur today)?

Explore elderly housing issues and describe current trends : Explore elderly housing issues and describe current trends. In this blog, you will provide your thoughts on the readings

Calculate and show the equilibrium output and interest rates : Calculate and show the equilibrium output and interest rates? Suppose instead the government conducts a balanced budget expansion of 120 units. Redo d and e.

Determine a or b has the higher present value : Given the following two sets of cash flows, determine whether A or B has the higher present value. Assume an interest rate of 12%.

Describe major differences in the application of contingency : Describe the major differences in the application of contingency management to moderation-oriented treatment versus abstinence-based treatment

Estimate increases to westmede operating cash flows : As part of its annual capital budgeting cycle, the Welsh Westmede hotel is deciding whether investment proposal A or investment proposal B is more financially.

Briefly research a contemporary theory : Use outside sources to briefly research a contemporary theory about the causes for one of the following mental disorders: schizophrenia

User Account

All Pages