The marginal product curve rises when the marginal cost curve rises

Suppose that Canada decides to peg its dollar ($C, or the loonie) to the U.S. dollar at an exchange rate of $C1 = $US1. What will happen to the Canadian IS curve as a result of the leftward shift of the U.S. IS curve?

A) It will shift rightward. B) It will shift leftward. C) It will not change. D) The IS curve will show an increase.

Government policies can change the costs and benefits that people face. Those policies have the potential to

a. alter people's behavior. b. alter people's decisions at the margin. c. produce results that policymakers did not intend. d. All of the above are correct.