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1) Assume the following equations summarize the structure of the economy. C = Ca + O.85(Y-T); Ca = 47015r; T = 200 + 0.2Y; Ip = 1,700 60r; G = 1,700; NX = 500 0.08Y and Md = 0.25Y 25r; Ms = 2,125 a) Derive the equation for the IS curve (0.2) b) Derive the equation of the LM curve. (0.2) 0) Compute the equilibrium interest rate and output. (0.1) d) Suppose the government increases its spending by 160 (1,700 => 1860). Compute the new equilibrium interest rate and output. (0.5). What is the amount of income that has been crowded out by this expansionary scal policy? (0.5) e) Compute the new equilibrium interest rate and output if G equals 1,700, but the money supply increases by 100. (0.5)