中级宏观经济学题目求解.Suppose that prices are completely rigid,so that the nominal and the real interestrate are necessarily equal.Money-market equilibrium is therefore given by M/P_= L(r,Y).a.Suppose that government purchases increase,and that the Federal Reserve adjuststhe money supply to keep the interest rate unchanged.i.Does the money supply rise or fall?ii.What happens to consumption and investment?b.Suppose that government purchases increase,and that the

中级宏观经济学题目求解
.Suppose that prices are completely rigid,so that the nominal and the real interest
rate are necessarily equal.Money-market equilibrium is therefore given by M/P
_
= L(r,Y).
a.Suppose that government purchases increase,and that the Federal Reserve adjusts
the money supply to keep the interest rate unchanged.
i.Does the money supply rise or fall?
ii.What happens to consumption and investment?
b.Suppose that government purchases increase,and that the Federal Reserve adjusts
the money supply to keep output unchanged.
i.Does the money supply rise or fall?
ii.What happens to consumption and investment?
c.Suppose that government purchases increase,and that the Federal Reserve keeps
the money supply unchanged.
i.Does the interest rate rise or fall?
ii.What happens to consumption and investment?