$4.$ Using the DD$-$AA framework, answer the following questions:

$($a$)($i$)$ Determine the short$-$run impacts on Y$,$ E$,$ current account $($CA$)$ and composition of the aggregate demand $($i$.$e$.$ the values of C$,$ I, G$,$ CA$)$ of a temporary fiscal expansions under fixed exchange rate regime.

$($ii$)$ How are the short run impacts on Y$,$ E$,$ current account $($CA$)$ and composition of the aggregate demand $($i$.$e$.$ the values of C$,$ I, G$,$ CA$)$ different for a permanent fiscal expansion under fixed exchange rate?

$($b$)$ Answer the same questions as in part $($a$)$ for floating exchange rate regime.

$($ch $7)$

$5.$ Suppose a country is under a fixed exchange rate regime. Suppose there is a temporary expansion in the central bank's domestic assets as it issues money to purchase domestic government bonds. Assume that, on impact, the current account does not change. Assume also that capital account and statistical discrepancy are negligible.

$($a$)$ What is the immediate impact on its balance sheet $($i$.$e$.$ its assets and liabilities$)?$

$($b$)$ What is the immediate impact of the central bank's transactions in the foreign exchange market on the reserve financial account and the non$-$reserve financial account?

$[$Hint: Refer to double$-$entry bookkeeping as explained in the textbook.$]$