Please derive the IS-LM model from both goods market and fi-nancial market. [Hint: combine the IS curve and LM curve togetherby three graphs.

5. Please derive the IS-LM model from both goods market and fi-nancial market. [Hint: combine the IS curve and LM curve togetherby three graphs.] And please explain in each market, the relation between interest rate and the output level. Please show your answers with algebra, graphs and words as much as you can.

6. Suppose the government makes a fiscal policy, which is to increase the government spending level. Given other factors constant, how will it affect the equilibrium in the IS-LM model? Please show this change with algebra, graphs and words as much as you can.

7. Suppose the government makes a monetary tightening policy.Given other factors constant, how will it affect the equilibrium in the IS-LM model? Please show this change with algebra, graphs and words as much as you can.

**Not an essay questions!