b. Faced with a zero (or maybe a just negative) nominal interest rate, suppose the central bank decides instead to purch

[answerhappygod]

b. Faced with a zero (or maybe a just negative) nominal interest
rate, suppose the central bank
decides instead to purchase (unconventional) securities directly to
facilitate the flow of credit in
financial markets. This policy is called quantitative easing. If
quantitative easing (QE) is
successful, so that it becomes easier for financial and
nonfinancial firms to obtain credit, what is likely to happen
to the premium? What effect will this have on the equilibrium in
the IS – LM diagram?