Ans14) the correct option is c) IS ; shifts to the right
When there is a tax cut, there is an increase in spending which increases aggregate demand and shifts the IS curve to the right
macroecon Ihcome Hses, money demand rises, and a higher interest rate is required. 14. A tax...
1) The Fed does easy money policy. As a result, the a. interest rate rises and the LM curve shifts left b. interest rate falls and the LM curve shifts left c. interest rate rises and the LM curve shifts right d. interest rate falls and the LM curve shifts right
1. If the money demand does not depend on the interest rate, then the LM curve ______. a. is horizontal b. is vertical c. shifts up to the right d. shifts down to the right 2. If money demand becomes more income elastic, the LM curve will __________. a. become flatter b. shift to the right c. become stepper d. shift to the left 3. The labour force is defined as _________. a. the total number of working age individuals...
A stock market boom would shift the aggregate demand curve to the Right.To offset this change, the Fed could increase the money supply. right. To offset this change, the Fed could decrease the money supply. left. To offset this change, the Fed could increase the money supply. left. To offset this change, the Fed could decrease the money supply. Other things the same, if the Fed increases the money supply, the interest rate rises so aggregate demand shifts right. rises...
What happens when the price level rises? a. Interest rates rise, so firms increase investment. b. Interest rates rise, so firms decrease investment. c. Interest rates fall, so firms increase investment. d. Interest rates fall, so firms decrease investment. 44. Which of the following shifts money demand to the left? a. an increase in the price level b. a decrease in the price level c. an increase in the interest rate d. a decrease in the interest rate 45. If the world real interest rate exceeds the Canadian real interest...
1. Which of the following properly describes the interest-rate effect? a. A higher price level leads to higher money demand, higher money demand leads to higher interest rates, and a higher interest rate increases the quantity of goods and services demanded.b. A higher price level leads to higher money demand, higher money demand leads to lower interest rates, and a lower interest rate reduces the quantity of goods and services demanded.c. A lower price level leads to lower money demand, lower...
34. An increase in consumer saving for any given level of income will shift the: A) LM curve upward and to the left. B) LM curve downward and to the right. C) IS curve downward and to the left. D) IS curve upward and to the right. 35. An increase in the money supply shifts the ______ curve to the right, and the aggregate demand curve ______. A) IS; shifts to the right B) IS; does not shift C) LM:...
OY 10. By referring to Figure 7-1, an increase in the money stock a shifts the LM schedule to the right from LMoto LM b shifts the LM schedule to the left from LMo to LM e leaves the LM curve unchanged at LM. d. shifts neither the IS nor the LM schedule. 11. Changes in all of the following shift the LM curve except a. the price level. b. income. c. the money supply. d. money demand. e. all...
1. If people expect higher inflation in the near future, the expected return on bonds rises/falls), and the demand for money (increases/decreases), leading to the rate of interest increasing/decreasing). 2. For the following questions, fill in the blanks below with: rises/falls/right/left/increase/decrease a. When real income increases, the demand curve for money shifts to the the interest rate _, everything else held constant. and b. A business cycle expansion increases income, causing money demand to interest rates to , everything else...
20. Banks decide to raise the interest rate they pay on checking accoun action would A) increase money demand, shifting the LM curve up and to the ci B) increase money demand, shiftino the IM curve down and to the C) decrease money demand, shifting the M curve up and to the tem D) decrease money demand, shifting the LM curve down and to cing accounts from 1% to 2%. This curve down and to the right. & the LM...
How would a tax on bond held by individuals affect the demand for money, interest rate, investment, aggregate demand, price and real GDP?