(b) (5 points) Circle the right changes for each variable listed below when you compare SREQ with the initial point A (when there was no policy). Briefly explain what happens to the investment in the SR. . No need to explain for Y, P and i- they must be shown in your graph. 1. Output (Y): Increase / Decrease / Same / Ambiguous 2. Prices (P): Increase/ Decrease / Same / Ambiguous 3. Interest rate (i): Increase / Decrease/ Same / Ambiguous 4. Investment, I(Y, i): Increase / Decrease/ Same / Ambiguous (c) (5 points) Circle the right changes for each variable listed below when you compare SREQ with the MREQ. Briefly explain what happens to the investment from the SR to the MR. No need to explain for Y, P and i- they must be shown in your graph. 1. Output (Y): Increase/ Decrease/ Same / Ambiguous 2. Prices (P): Increase / Decrease/ Same / Ambiguous 3. Interest rate (i): Increase / Decrease/ Same / Ambiguous 4. Investment, I(Y, i): Increase / Decrease / Same / Ambiguous

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