Iowa State University

Department of Economics

Intermediate Macroeconomics

Fall 2006 Problem Set #4 Alexander

This problem set is due on Tuesday, December 5

 

  1. Using IS/LM, the money market, and AD/AS, describe and graphically depict the effect of an increase in the marginal tax rate on the level of output, the interest rate, and the price level in the short-run (1 period) and the long-run.

    2.  

  2. Using IS/LM, the money market, and AD/AS, describe and graphically depict the effect of a decrease in the money supply on the level of output, the interest rate, and the price level in the short-run (1 period) and the long-run.