If the supply of money increases, what happens in the IS-LM framework?
A) The IS curve shifts right.
B) The LM curve shifts right.
C) The IS curve shifts left.
D) The LM curve shifts left.
Ans: B) The LM curve shifts right.
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A competitive, unregulated market would
A) produce too much pollution because pollution is an external cost. B) produce too little education because education has an external benefit. C) fail to achieve equilibrium if there are externalities present. D) Both answers A and B are correct. E) Both answers B and C are correct.
By spreading her investments out over many different assets, an investor achieves
A) a higher expected return. B) increased risk. C) diversification. D) greater liquidity.
What are the three goals of the Employment Act of 1946?
A) keep the peace, improve public education, and protect the environment B) improve the education system, provide more job training, and expand the number of government jobs C) full employment, price stability, and economic growth D) full employment, better schools, and lower income taxes
Assume that the demand curve for DVD players shifts to the left and the supply curve for DVD players shifts to the right, but the supply curve shifts less than the demand curve. As a result
A) both the equilibrium price and quantity of DVD players will decrease. B) the equilibrium price of DVD players will decrease; the equilibrium quantity may increase or decrease. C) the equilibrium price of DVD players may increase or decrease; the equilibrium quantity will increase. D) the equilibrium price of DVD players will decrease; the equilibrium quantity will increase.