Question: Give me the answer with the labeled graphs for a , b and c . NX ( E ) = S I ( r *

Give me the answer with the labeled graphs for a , b and c. NX(E)= S I(r*) This equation is used to draw the diagram illustrating the foreign exchange market, where there is a negative relationship between /VX and c; and S/(r*)is perfectly inelastic. Here /VX is net exports, e is the exchange rate, S represents the level of savings in the economy, I represent the level of investment in the economy, and r is the interest rate.
a. Assume that the government of Jamaica increases personal income tax, with the aid of a carefiffly labeled diagram, illustrate the effect of this contractionary fiscal policy on savings, interest rate, net capital outflow and the exchange rate in Jamaica. (7 marks)
b. Assume that the government of the United States increases their personal income tax, with the aid of a carefully labeled diagram; illustrate the effect of this contractionary fiscal policy abroad on savings, interest rate, net capital outflow and the exchange rate in Jamaica. (7 marks)
c. Use a carefully labeled diagram to illustrate the effect of an increase in investment demand in Jamaica on interest rate, net capital outflow and the exchange rate in the domestic economy.

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