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- When investment is negatively related to the rate of interest, equilibrium output in the goods market
- Is unrelated to the rate of interest
- In inversely related to the rate of interest
- Is positively related to the rate of interest
- Falls as the rate of interest decreases
- A $10 increase in autonomous investment shifts IS
- Rightward by $10
- Leftward by $10
- Rightward by K
_{e}($10) - Leftward by K
_{e}($10) - Given the IS equation bi, the IS slope decrease (the IS schedule becomes flatter) when
- \({k_e}\) increases and b increases
- \({k_e}\) decreases and b increases
- \({k_e}\) increasea and b decreases
- \({k_e}\) decreases and b decreases
- An increase in autonomous lump-sum taxes shifts IS
- Rightward by \({k_t}\left( {\Delta \overline T x} \right)\)
- Leftward by \({k_t}\left( {\Delta \overline T x} \right)\)
- Rightward by \({k_t}\left( {\Delta \overline T x} \right)\)
- Leftward by \({k_t}\left( {\Delta \overline T x} \right)\)
- The demand for money is
- Positively related to output and the rate of interest
- Negatively related to output and the rate of interest
- Negative related to output and positively related to the rate of interest
- Positively related to output and negatively related to the rate of interest
- Suppose the money supply and price level are constant, and the demand for money is a function of output and the rate of interest. When output increases, there is
- An increase in the quantity of money demanded and an increase in the rate of interest
- An increase in the quantity of money demanded and a decrease in the rate of interest
- A decrease in the quantity of money demanded and a decrease in the rate of interest
- A decrease in the quantity of money demanded and an increase in the rate of interest
- When the LM equation is Y = $750 + 20i, there is equilibrium between the supply of and the demand for money when
- The rate of interest is 10% and output is $750
- The rate of interest is 10% and output is $800
- The rate of interest is 10% and output $950
- The rate of interest is 10% and output is $900
- When there is an increase in the autonomous money supply, ceteris paribus, LM shifts
- Rightward by \(\Delta \overline M \)
- Rightward by \(k(\Delta \overline M )\)
- Rightward by \((\Delta \overline M )/k\)
- Rightward by \(k/(\Delta \overline M )\)
- Equilibrium in the money markets can be expressed by the equation \(i = \left( {k/h} \right)Y - \overline M /h\) The slope of LM decreases (the LM schedule becomes flatter) when
- K increases and h increases
- K increases and h decreases
- K decreases and h increases
- K decreases and h decreases
- Simultaneous equilibrium in the money (LM) and goods (IS) markets exists
- At an unlimited number of output levels and rates of interest
- At only one output level and rate of interest
- At an unlimited number of output levels and only one rate of interest
- At only one output level and an unlimited number of rates of interest

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