The IS curve would be vertical if
A) the government's budget was balanced.
B) autonomous expenditures were insensitive to the interest rate.
C) the demand for money was insensitive to the interest rate.
D) the government increased the money supply.
B
Economics
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The aggregate demand curve shifts to the left when there is ________
A) autonomous tightening of monetary policy B) an increase in the nominal interest rate C) an increase in inflation D) all of the above E) none of the above
Economics
According to the rational expectations school, a correctly anticipated expansionary monetary policy will:
a. increase prices and real output b. increase real output only in the short run. c. have no effect on prices or real output. d. decrease prices and real output. e. lead only to a higher price level.
Economics