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{"ops":[{"insert":"Q.1 Consider the following information about a hypothetical economy:\n1. Y = A(0.025K-0.5N)N\n2. A=2\/3\n3. K=2000\n4. N^s=-18+(18\/5)w\n5. C=200+(2\/3)(Y-T)-300r\n6. T=-75+(1\/4)Y\n7. I =100\u2212100r\n8. G =100\n9. L = 0.5Y \u2212 200i\n10. M = 6300\n11. \u03c0^e= 0.10\nNow using this information, answer the following:\n(k) Suppose that Li \u2192 \u221e in Equation.9 of the model. How will it affect the shape of the money demand and\u00a0\nthe LM curve. Will the monetary policy of part (e) have the same effect as calculated above or any\u00a0\ndifferent? Explain using graphs and multipliers.\n"}]}
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