An increase in the domestic price level will
A. shift the IS curve to the right.
B. shift the FE curve to the left.
C. lead to a surplus in the balance of payments.
D. shift the LM curve to the right.
Answer: B
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A dominant strategy is one that
a. makes every player better off b. makes at least one player better off without hurting the competitiveness of any other player c. increases the total payoff for one player d. is best for a player, regardless of what strategy other players follow e. leads to quicker convergence to market equilibrium
An economic model is a detailed version of an economic environment.
Answer the following statement true (T) or false (F)
We would expect which of the following to occur when the central bank pursues expansionary monetary policy?
A) an increase in bond prices and an increase in the interest rate (i) B) a reduction in bond prices and an increase in i C) an increase in bond prices and a reduction in i D) a reduction in bond prices and a reduction in i E) none of the above
What phase of the business cycle immediately follows a recession?