Illustrate each of the following situations with a graph showing the IS curve and the Fed rule, and explain what happens to the equilibrium values of the interest rate and output:

a. An increase in public spending by the government with the money supply held constant.

b. An increase in interest rates by the central bank to offset the effects of a reduction in taxation on prices.

c. An increase in the aggregate price level due to a rise in world energy prices. The central bank and the government do not react.

d. A decrease in the money supply due to inflationary pressures by the central bank in an attempt to keep the real money supply constant.

e. A decrease in public spending by the government with the interest rates held constant by the central bank.