Ch$\mathrm{.}7$ material. Consider an economy at Full$-$potential: Suppose the Real Money Demand function is given by L$($Y$,$i$)=1000+0\mathrm{.}5$Y $500$i Assume the market for money is in equilibrium, & that initially: Y $=5000($i$.$e$.$ full$-$potential $=5000),$ r$=2\%,$ e $=1\%,$ and P$=4$; do not convert $\%$ to decimals, use as is$.$ Use the Fisher Equation: i$=$r$+$e Remark: In your calculations below use r$=2$ & e $=1$ in your equations; do not convert to decimals. a$)$ Calculate the real money demand $($give #$).$ Show work. b$)$ Solve for nominal money supply $($give #$).$ Show work. c$)$ Now consider the impact of a shock: Suppose that a shock to productivity causes a rise in fullpotential, so that Y$=8000$ and r falls to $1\%($no impact on inflation expectations$).$ What is the impact of this shock on the price level? Calculate the new Price Level $($give #$)$; show work. Again, use r$=1$ in your calculations. d$)$ What can you conclude about the impact that a positive $$supply shock$($i$.$e$.$ shock to supply$)$ has on the price level? State briefly.