A. Suppose that potential output Y* equals 12,000. What real interest rate should the Fed set to bring the economy to full employment? You may take as given that the multiplier for this economy is 5. b. Repeat part a for the case in which potential output Y* equals 9,000
c. Show that the real interest rate you found in part a sets national saving equal to planned investment when the economy is at potential output. This result shows that the real interest rate must be consistent with equilibrium in the market for saving when the economy is at full employment.

Can you with personal finance homework1 abbreviation of annual percentage rate which the interest rate is applied annually to a loan or a credit card balance2 abbreviation of annual percentage yield the rate of return earn in the course of one whole year taking compounding into amount expressed as a percentage3 cash and other liquid assets such as demand deposits or treasury bills than individual possesses4 an expense that does not vary from one time period to the next5 to obtain a new loan for something on different terms often involving the pain off of an existing high-interest loan by means of a new lower interest one6 money set aside for future use7 to take money out of an account8 to plan the allocation expenditure or use of money9 the amount of money spent on food clothing and other basic necessities10 the amount of money that is anticipated to be received over a. of time either as payment for work goods or services or as profit on capital