Assume that an open economy with a floating exchange rate is described by the equations:

ENGR.ECONOMIC ANALYSIS
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Assume that an open economy with a floating exchange rate is described by the equations:
C = 0.75(Y-T)
T= 2000
I= 2000 -250r
G= 3000
NX= 1500 – 250e
(M/P)d = 0.4Y – 550r
M= 2000
S-I= 600 – 250r
P= 2
r* = 2
a. Derive the equation for the IS* curve. 
b. Derive the equation for the LM curve. 
c. Solve for NX and e.

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