In the ISLM framework, a rising price level causes
A) the equilibrium interest rate to rise.
B) the equilibrium level of income to fall.
C) desired saving to rise.
D) the LM curve to shift to the right.
A
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Which of the following lists correctly identifies the four expenditure categories of GDP?
a. consumption, government purchases, investment, net-exports b. consumption, investment, depreciation, net-exports c. consumption, saving, investment, depreciation, d. consumption, government purchases, investment, savings
The law of increasing opportunity costs indicates that:
A. the sum of all costs cannot rise above the market price of a product. B. to produce more of one good, society must sacrifice larger and larger amounts of alternative goods. C. resources are perfectly mobile except for transportation costs. D. if the prices of all the resources involved in the production of goods increase, the cost of producing those goods will increase at the same rate.
An increase in government transfer payments will shift the aggregate demand curve to the right
A) by the initial change in consumption arising from the change in transfer payment × the spending multiplier. B) by the initial change in income arising from the change in transfer payment × the spending multiplier. C) by the change in transfer payments × times the spending multiplier. D) by the change in transfer payments × times the marginal propensity to consume
ItemBillions of DollarsCheckable Deposits$597Small Time Deposits818Currency639Money-Market Mutual Funds Held by Businesses1,045Savings Deposits, Including Money-Market Deposit Accounts2,866Money-Market Mutual Funds Held by Individuals979Refer to the above table. The size of the M1 money supply is:
A. $979 billion. B. $1618 billion. C. $1236 billion. D. $1415 billion.