Economist B says all of the following: Expansionary fiscal policy is needed to raise aggregate demand and remove the economy from a recessionary gap. The choice of fiscal policy measures is between more government spending and a ___________ in taxes. Since I am in favor of smaller government, I choose a __________________ in __________________

If money demand is not responsive to changes in interest rates, then

a. the LM curve is vertical. b. the IS curve determines equilibrium output. c. the LM curve will become horizontal. d. the LM curve will become vertical. e. a and b.

A straight line tangent to a curved line at a point

a. crosses the curved line at that point b. crosses the curved line at many points c. has the same slope as the curved line at that point d. is steeper than the curve at all other points e. has a smaller slope than all other points on the curve