5. Which of the followings is not cause the aggregate supply curve to shift: Select one:...

5. Which of the followings is not cause the aggregate supply curve to shift:

Select one:

a. higher government spending

b. expectations of inflation

c. tightness of the labor market

d. supply shocks unrelated to wages

The LM curve slopes upward, because higher aggregate output raises the demand for money and so raises the equilibrium interest rate.

Select one:

True?

False?

8. The LM curve slopes upward, because higher aggregate output raises the demand for money and so raises the equilibrium interest rate.

Select one:

True?

False?

10, What happens in the ISLM model if government impose an expansionary monetary policy?

Select one:

a. LM curve shifts to the right

b. LM curve shifts to the left

c. IS curve shifts to the left

d. IS curve shifts to the right

Solutions

Expert Solution

Q5) the answer is (a) higher government spending

This leads to an increase in the demand and causes the AD ot shift tot he right. there is no shift in the aggregate supply. All other options are incorrect as they will lead to a shift in aggregate supply.

Q8) The answer is true. This is the exact reason why the LM curve slopes upwards.

Q10) The answer is (a)

Moneetary policy does nto affect the IS curve. An expansionary monetary policy will shif the LM curve to the right (down).

All other options are incorrect as they do not correctly show the effects in ISLM model.

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

A looseningloosening of the labor market will cause A. the aggregate supply curve to shift down....

A looseningloosening of the labor market will cause A. the aggregate supply curve to shift down. B. the aggregate supply curve to shift up.the aggregate supply curve to shift up. C.the aggregate demand curve to shift left.the aggregate demand curve to shift left. D.the aggregate demand curve to shift right. When the labor market is? tight, A. wages? fall, and the aggregate supply curve shifts down. B.wages? rise, and the aggregate supply curve shifts down. C.wages? rise, and the aggregate...

Which of the following will cause the aggregate demand curve to shift to the right ?...

Which of the following will cause the aggregate demand curve to shift to the right ? a. A decrease in household wealth b. A decrease in the price level c. Consumer expectations of higher future income d. An increase in the interest rate Which of the following events would most likely caused the increase in aggregate demand a. An increase in interest rates b. An increase in household wealth c. A decrease in consumer confidence d. A decrease in the...

What makes the aggregate supply curve shift and how does a shift in the aggregate supply...

What makes the aggregate supply curve shift and how does a shift in the aggregate supply curve help expand the economy?

State which of the following changes cause a shift in the aggregate demand curve and which...

State which of the following changes cause a shift in the aggregate demand curve and which ones are a movement along it. Also provide the direction of the change. A cut in government purchases. A crash in the U.S. stock market. A shift to a lower inflation target in the monetary policy rule. Being thrifty now becoming fashionable. An increase in the European interest rate.

7. Which one of the following would shift the long-run aggregate supply curve to the right?...

7. Which one of the following would shift the long-run aggregate supply curve to the right? (a) increased international trade (b) an increase in the price level (c) a reduction in immigration (d) an increase in government spending (e) a higher minimum wage 8. To explain the long-run trend of rising output and prices observed in the U.S. : (a) the LRAS must increase over time, while the AD must remain constant. (b) the LRAS must remain constant over time,...

What are some factors which would cause a shift in either aggregate supply or aggregate demand?...

What are some factors which would cause a shift in either aggregate supply or aggregate demand? If our oil suppliers suddenly stopped selling oil to the U.S., which curve would shift? What would then happen to our economy? Neat handwriting if written please.

Which of the following will cause a rightward shift (increase) of the supply curve for OLED...

Which of the following will cause a rightward shift (increase) of the supply curve for OLED smart TVs? Answers: A. A decrease in the labor costs associated with the production of OLED smart TVs B. An improvement in the technology used to produce OLED smart TVs C. A decrease in the price of regular smart TVs D. All of the above

Which of the following will shift the aggregate supply curve to the right? Instructions: You may...

Which of the following will shift the aggregate supply curve to the right? Instructions: You may select more than one answer. Click the box with a check mark for correct answers and click to empty the box for the wrong answers. a substantial increase in the price of oil a two-fold increase in the manufacturing wages as a result of a law passed by the government a decrease in business taxes an increase in the overall productivity in the economy...

Which of the following would cause a definite leftward shift of the supply curve? an increase...

Which of the following would cause a definite leftward shift of the supply curve? an increase in the cost of an input and an expectation by firms of a lower price an increase in the price of a complement in production and a decrease in the cost of an input an increase in taxes and an increase in the number of firms an increase in the price of a substitute in production and a decrease in productivity

List the variables that will cause the supply and demand curve to shift?

Subjects