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For the following five questions, assume the following characteristics of the monetary transmission mechanism:The money multiplier is 3.25Interest rates will change by 2.5% for every $45 billion change in the money supply.Investment will change by $76 billion for every 1.5% change in the interest rate.Income will change by $14.3 billion for every $5.7 billion change in investment.Identify the change in income when the Fed does the following:1. Buys $35 billion in bonds.2. Buys $18 billion in bonds.3. Buys $4 billion in bonds.4. Sells $12 billion in bonds.5. Sells $22 billion in bonds.

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For the following five questions, assume the following characteristics of the monetary-example-1
For the following five questions, assume the following characteristics of the monetary-example-2
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