IS$/$LM and AS$/$AD Model $(10$ pts each$)$

Using the IS$/$LM and AS$/$AD frameworks, analyze the shortand long$-$run effects on interest rates $($ r $),$ output $($ Y $),$ and price level $($P$)$ under each of the following scenarios. For full credit, provide correctly labeled graphs and detailed explanations of the dynamic adjustments within the model. Your response should demonstrate a deep understanding of the theoretical principles taught in class without relying on external sources.

A$.$ Increased Consumer Credit Availability: Explain how the availability of more consumer credit impacts aggregate demand and interacts with both the goods market $($IS curve$)$ and the money market $($LM curve$).$ Discuss the implications for both short$-$term price and output adjustments and long$-$run equilibrium.

B$.$ Contractionary Monetary and Fiscal Policies $($ Mdarr and Gdarr $)$: Analyze the combined effects of a decrease in the money supply and reduced government spending on the economy. Explain how these dual policies influence aggregate demand, the IS and LM curves, and long$-$run price and output levels.

C$.$ Increased Aggregate Productivity $($New Invention$)$: Explore how a rise in productivity alters the aggregate supply side of the economy and interacts with aggregate demand. Address both the short$-$run dynamics of the IS$/$LM model and the long$-$run implications for prices, output, and growth.

Additional Guidance:

Discuss the adjustments in each model over time $($e$.$g$.,$ shifts in curves, crowding out, inflation expectations$).$

Relate your explanations to theoretical foundations, avoiding generic or overly simplistic summaries.

Include specific examples or hypothetical scenarios to illustrate your points and connect them to the mechanics of the models. Important: Responses must strictly adhere to the modeling conventions and assumptions introduced in the course. Misinterpretations or external adaptations, such as diagonal SRAS curves, will result in reduced credit.