(a) To calculate the general equilibrium level of real wage, employment and output, the given functions are:Production function: F = A(10N − 0.005N² ), where A = 2Labor supply curve: Ns = 32 + 10(1 − t)w, where t = 0.5Desired consumption function: Cd = 650 + 0.8(Y − T) − 100rDesired investment function: Id = 650 − 100rGovernment tax: T = 40 + 0.5YGovernment purchase: G = 97.6Real money demand function: L = 0.5Y − 250iNominal money supply: M = 27700Expected inflation rate: πe = 2%Now, the General equilibrium level of real wage, employment, and output are:Real wage:From labor supply equation Ns = 32 + 10(1 − t)w, we have:w = (Ns - 32)/10 + t/2Using t = 0.5 and A = 2, the production function can be written as:F = 2(10N − 0.005N² )F = 20N - 0.01N²Marginal product of labor (MPL) is given by:MPL = dF/dN = 20 - 0.02NFrom MPL = w, we have:w = 20 - 0.02NPutting the value of w in the above equation: (Ns - 32)/10 + t/2 = 20 - 0.02NNs - 320 = 200N - N²/50N² - 200N + 320 = 0N² - 400N + 6400 = 0N = 200 ± 20√6Putting N = 200 + 20√6 in (Ns - 32)/10 + t/2 = 20 - 0.02N, we get:w = $ 2.18Employment:From labor supply equation Ns = 32 + 10(1 − t)w, we have:Ns = 32 + 10(1 − t)wPutting t = 0.5 and w = $2.18, we get:Ns = 50.9Output:Output is given by:Y = F(Y) = 2(10N − 0.005N² )Putting N = 200 + 20√6, we get:Y = $ 10,752.12Therefore, the general equilibrium level of real wage, employment, and output is $2.18, 50.9, and $10,752.12, respectively.(b) The IS curve equation is given by:Y = Cd + Id + G − TFrom Cd = 650 + 0.8(Y − T) − 100r and Id = 650 − 100r, we have:Cd + Id = 1300 − 100rSubstituting T = 40 + 0.5Y and G = 97.6 in the above equation, we get:Y = 347.36 − 0.25r(c) Real interest rate:From the IS curve equation:Y = 347.36 − 0.25rPutting Y = 10,752.12, we have:r = 1,657.5Consumption:From Cd = 650 + 0.8(Y − T) − 100rPutting T = 40 + 0.5Y and r = 1,657.5, we get:Cd = $ 8,538.14Investment:From Id = 650 − 100rPutting r = 1,657.5, we get:Id = $ 48,250Real equilibrium can be calculated by the intersection of IS and LM curves, which is the solution for the pair of equations:Y = 347.36 − 0.25r .....(1)L = 0.5Y − 250i ......(2)Using L = M/P and M = 27700, we can rewrite equation (2) as:i = 0.002Y − 0.0048Substituting the value of i in equation (1), we get:Y = 383.64 − 0.125YPutting Y = 10,752.12, we get:P = $ 80.28(d) The equation that describes the LM curve is given by:M/P = L, where L = 0.5Y − 250iPutting i = 0.002Y − 0.0048, we get:L = 0.5Y − 125(0.002Y − 0.0048)L = 0.5Y − 0.25The equation that describes the LM curve is Y = 2,000P.(e) The equation that describes the AD curve is given by:AD = C + I + G + NX = Cd + Id + G + NX = 1300 − 100r + 97.6 + 0 = 1397.6 − 100r(f) The equation that describes the FE curve is given by:Y = YFEYFE is the level of output where the aggregate demand (AD) is equal to the potential output (Y). Therefore, putting AD = Y and solving for Y gives the equation for FE curve:1397.6 − 100r = A(10N − 0.005N² )Putting r = 1,657.5, we get:YFE = $ 10,749.5The equation that describes the FE curve is Y = $ 10,749.5.