When the price of a good increases, the budget constraint shifts in parallel to the original budget constraint.

In the first six months of 2003, branches of Commerce Bank in New York City were robbed 14 times

The New York City Police recommended steps the bank could take to deter robberies, including the installation of plastic barriers called "bandit barriers." The police were surprised the bank did not take their advice. According to a deputy commissioner of police, "Commerce does very little of what we recommend. They've told our detectives they have no interest in ever putting in the barriers." It would seem that Commerce Bank would have a strong incentive to install "bandit barriers" to deter robberies. Why wouldn't they do it? A) The banks must have weighed the cost of installing bandit barriers against the benefits and decided that they have "no interest in ever putting in the barriers." B) The banks probably resent any interference from the police department. C) The banks would rather delay installation of any theft deterring equipment in anticipation of new, lower-cost innovations in the security devices market. D) The banks are concerned that "bandit barriers" would send the wrong message to customers — that the bank is unsafe.

Within the IS-LM curve model, an increase in government spending financed by printing money will always

a. have no impact on income. b. lower income and raise the interest rate. c. increase the interest rate. d. lower the interest rate and increase income. e. increase income.