Using either the Keynesian cross model or the market for real money balances (whichever one is appropriate), please illustrate what happens under the following circumstances. Then illustrate this using the IS-LM model. Finally, comment on what happens to income/output and the interest rate? a. The Fed buys bonds using open market operations.
b. According to the American Society of Civil Engineers (ASCE), America’s infrastructure gets a grade of D+. Feeling very ashamed, Congress decides to take action and allocates $3.5 trillion for construction projects.
c. The government raises income taxes.

Special order carson manufacturing, inc., sells a single product for $36 per unit. at an operating level of 8,000 units, variable costs are $18 per unit and fixed costs $10 per unit. carson has been offered a price of $20 per unit on a special order of 2,000 units by big mart discount stores, which would use its own brand name on the item. if carson accepts the order, material cost will be $3 less per unit than for regular production. however, special stamping equipment costing $4,000 would be needed to process the order; the equipment would then be discarded. assuming that volume remains within the relevant range, prepare an analysis of differential revenue and costs to determine whether carson should accept the special order. use a negative sign with answer to only indicate an income loss from special order; otherwise do not use negative signs with your answers.