When the demand for money depends only on real income, the resulting ________ LM curve causes fiscal policy to have a ________ effect on income

The United States uses tax funds to build and repair the interstate highway system and to provide health care services via Medicare. Suppose Medicare services are on the horizontal axis and highway miles are on the vertical axis of a PPF

If the government decides to reduce funding to Medicare, this change would be shown as A) a shift out of the PPF. B) the PPF becoming flatter. C) a movement down along the PPF. D) a movement up along the PPF.

Suppose you sell a $1,000 bond that matures in 1 year for $950. Calculate the interest rate you will have to pay on this bond.

A) 0.95% B) 5.0% C) 5.3% D) 95%