# Prepare a 1 page (double-spaced) essay and answer the following questions: Assume that we have the following data: C=100+0.50Y Ip=100-20r Mt=0.10Y Ms=100-10r M=80 a. Build the IS-LM function. b. If we assume an increase in Investments by 100 units, please calculate again the IS-LM functions. c. The intersection of IS-LM functions defines four areas. Please analyze the behavior of the markets for goods and money for each area.

After reading all the available information carefully, prepare a 1 page (double-spaced) essay and answer the following questions:
Assume that we have the following data:
C=100+0.50Y
Ip=100-20r
Mt=0.10Y
Ms=100-10r
M=80
a. Build the IS-LM function.
b. If we assume an increase in Investments by 100 units, please calculate again the IS-LM functions.
c. The intersection of IS-LM functions defines four areas. Please analyze the behavior of the markets for goods and money for each area.
Cite references to material that you use in preparing the essay.

• Accurately described (graphically or verbally) the IS-LM functions.
• Accurately describe (graphically or verbally) the shift of the IS-LM function when Investments increase by 100 units.
• Describe each of the four areas defined by the IS-LM function.
• Use at least one example in the essay.
• Organization Grading Guidelines: Presentation is very effective and presented in a logical format with a clear beginning, middle, and end. There is a clear statement of ideas and smooth transitions. The writer has stated the main idea clearly and has provided relevant details. The main idea is clearly conveyed in a presentation that is highly relevant and interesting. The student provides evidence of thoughtful input. Details are rich and appropriate. Spelling, punctuation, and capitalization are virtually always correct.

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Regards,

Cathy, CS.