Question: The parameters a, b, c, d, and e are non-negative constants. The remaining variables have their usual interpretations. (a) What are the exogenous variables and

 The parameters a, b, c, d, and e are non-negative constants.

The parameters a, b, c, d, and e are non-negative constants. The remaining variables have their usual interpretations. (a) What are the exogenous variables and what are the endogenous variables? List them. (b) Explain intuitively why we do not have a labor demand curve when the price level is sticky. (c) Algebraically solve for an expression for the IS curve. (d) Algebraically solve for an expression for the LM curve. (e) Algebraically solve for an expression for the AD curve. (f) Combine your algebraic expression for the AD curve with the given AS curve (P = P) to express equilibrium output, Y, as a function of exogenous variables only. (g) How is the sensitivity of output to the money supply (i.c. #), impacted by the sensitivity of consumption demand to the real interest rate (as measured by the parameter c)? Can you provide any intuition for this? (h) Use your previous work to derive expression for how Y, N, and w are impacted by

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