contestada

consider the islm model diagram. starting from equilibrium and a balanced budget, sketch and explain what happens to equilibrium if: a) the government finances increase domestic expenditure by printing money. (8 points) b) the government finances increased domestic expenditures by selling bonds to the public but not to the central bank. (recall that wealth is fixed) (8 points) c) the government finances a program of foreign aid, none of which will be used to purchase us goods, by selling bonds to the public. (8 points) d) the government finances a program of foreign aid, none of which will be used to purchase us goods, by selling bonds to the central bank. (8 points) e) which of the above cases carries with it the highest risk of inflation? (8 points)