Hello- Seeking assistance understanding how to do practice problem set for intro macro course.

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ANSWER 3. 
a) When japan is at full employment level, then an increase in government spending leads to 
inflationary expectations leading to a fall in real money supply. This causes only an increase in 
real rate of interest an no change in output. In saving investment model the effect is seen in an 
upward shift of savings curve, due to increased real interest rate at full employment,

Hello- Seeking assistance understanding how to do practice problem set for intro macro course.

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