Suppose that the IS curve is stable and money demand is lower than forecasted

If the Fed is targeting the interest rate, it notices the rate is ________ its target, and action to correct this, shifting the LM curve to the ________, causes GDP to ________ natural GDP. A) below, right, fall back toward
B) below, right, rise further from
C) below, left, return to
D) above, left, fall back from
E) above, right, rise further from


C

Economics

You might also like to view...

In Year 1 suppose the economy is at potential GDP and that the federal budget deficit equals $100 billion. In Year 2 the federal budget deficit rises to $150 billion, but the cyclically adjusted budget deficit falls to $75 billion

How can the actual budget deficit rise and the cyclically adjusted budget deficit fall?

Economics

McDonalds kept its U.S.-based menu when entering the Chinese market

Indicate whether the statement is true or false

Economics

Assuming seigniorage equals zero, the federal debt is ________ and the budget deficit is ________

A) a flow variable representing the total value of government bonds outstanding; a stock variable representing the yearly increase in value of newly issued government bonds B) a stock variable representing the total value of government bonds outstanding; a flow variable representing the yearly increase in value of newly issued government bonds C) a flow variable representing the yearly increase in value of newly issued government bonds; a stock variable representing the total value of government bonds outstanding D) a stock variable representing the yearly increase in value of newly issued government bonds; a flow variable representing the total value of government bonds outstanding

Economics

Western expansion contributed to U.S. growth and development of the economy by

(a) privately mobilizing idle natural resources and land. (b) placing land in the hands of the public, with no private rights. (c) having government officials set land prices. (d) all of the above.

Economics