Homework Week 6 Answers The homework is worth 20 points, so each answer will have points distribution at the instructor’s discretion. Chapter 14 1. a. Given that the interest rate has been 4 percent for the last ten quarters, then for IS curve I, real GDP equals 8,800 − 25(4) − 25(4) − 25(4) − 25(4) − 20(4) − 20(4) − 20(4) − 15(4) − 15(4) − 10(4) = 8,000. For IS curve II, real GDP equals 8,400 − 5(4) − 5(4) − 5(4) − 5(4) − 10(4) − 15(4) − 15(4) − 15(4) − 20(4) = 8,000. b. For IS curve
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