Suppose the intersection of the IS and LM curves is to the left of the FE line. A decrease in the price level would most likely eliminate a disequilibrium among the asset, labor, and goods markets by
A. shifting the IS curve down and to the left.
B. shifting the LM curve down and to the right.
C. shifting the IS curve up and to the right.
D. shifting the FE curve to the left.
Answer: B
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