please answer b and c , I have done question a, thanks very much!

2. Interest Rate Rule Choosing a trade-off: Our monetary model consists of three equations, the Interest-Savings equation, the (Short Run) Phillips Curve, and an Interest Rate Rule, y= A -ar a = 7 +k(y - y*) r = p* + y(y y*) + $7(71 77) where y = output, y* = 'efficient output, r = real interest rate, p* = real interest rate associated with 'efficient output, a = inflation, tre = expected inflation, T = target inflation. Assume that beginning from a state of high inflation expectations and high target inflation the central bank decides to fight against inflation and so announces a new lower target inflation. Thus we are in a situation in which 77 qe or a 1 or a y* or y 77.) (c) Argue that 7 is decreasing in k, and that y is increasing in k. Write a sentence or two interpreting this in terms of what the effect of the new lower target inflation on the economy