Question: Exercise 11.11 Optional: Suppose the central bank's monetary policy sets the interest rate accord- ing to the function: i= 3.0+2.0(1 1*) with 7* = 4.0,

Exercise 11.11 Optional: Suppose the central

Exercise 11.11 Optional: Suppose the central bank's monetary policy sets the interest rate accord- ing to the function: i= 3.0+2.0(1 1*) with 7* = 4.0, and aggregate expenditure is the sum of: C= 200 +0.75Y I=85-2i G=100 X-IM = 50 - 0.15Y - 3i (a) What is the equation for the ADA curve? (b) Plot the ADA curve in a diagram, not necessarily to scale, that shows the horizontal intercept and slope of the curve

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