Desired consumption is Cd = 100 + 0.8Y - 500r - 0.5G,and desired investment is Id = 100 - 500r.Real money demand is Md/P = Y - 2000i.Other variables are πe = 0.05,G = 200, 
= 1000,and M = 2100.
(a)Find the equilibrium values of the real interest rate,consumption,investment,and the price level.
(b)Suppose the money supply increases to 2800.Find the equilibrium values of the real interest rate,consumption,investment,and the price level.(Assume that the expected inflation rate is unchanged.)
Definitions:
Depression
A low, sad state marked by significant levels of sadness, lack of energy, low self-worth, guilt, or related symptoms.
Interpersonal Problem Areas
Conditions or situations in relationships between individuals that can lead to conflict or distress.
Depression
A mood disorder that causes a persistent feeling of sadness and loss of interest, affecting how you feel, think, and handle daily activities.
Psychodynamic Approach
A psychological perspective that emphasizes the systematic study of the psychological forces that underlie human behavior, feelings, and emotions and how they might relate to early experience.
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