Problem
Suppose, in the monetary intertemporal model, that the government can pay interest on money, financing this interest with lump-sum taxes on consumers. If the nominal interest rate on money is the same as the nominal interest rate on bonds, determine the effects in the model, illustrating this in a diagram. Explain your results.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.