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21 Oct 2020

In the IS-LM model, a decrease in interest rate will cause money demand to ______ and the national output or income to ______

  1. Increase; increase

  2. Increase; decrease

  3. Decrease; decrease

  4. Decrease; increase

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Kristelle Balando
Kristelle BalandoLv10
21 Oct 2020

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Related questions

In the IS model, a decrease in interest rate will cause investment to ______ which will cause the national output or income to ______

    1. Increase; increase

    2. Increase; decrease

    3. Decrease; increase

    4. Decrease; decrease

Which of the following best describes the cause-effect chain of a restrictive monetary policy?

A. A decrease in the money supply will lower the interest rate, increase investment spending, and increase ยท aggregate demand and GDP.

B A decrease in the money supply will raise the interest rate, decrease investment spending, and decrease aggregate demand and GDP.

C An increase in the money supply will raise the interest rate, decrease investment spending, and decrease aggregate demand and GDP.

D An increase in the money supply will lower the interest rate, decrease investment spending, and increase aggregate demand and GDP.ย 

A decrease in the interest rate will cause a(n):

a. Increase in the transactions demand for money.

b. Decrease in the transactions demand for money.

c. Decrease in the amount of money held as an asset.

d. Increase in the amount of money held as an asset.

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