In the IS-LM framework, all others remain the same, the decline in investment spending is illustrated by the movement of the __________ curve to __________.   a. IS; left   b. LM; left   c. LM; right   d. IS; right

1.     1. Factors that shift the IS curve involve:   A) interest rates and levels of GDP.   B) the quantity of money and the demand for money.   C) the trade balance.   D) exogenous variables affecting demand, such as a change in government spending or a change in the exchange rate.     2. The LM curve shows that, with a fixed supply of money, as GDP rises, the demand for money will ____ and the rate of interest will ____.   A) rise; rise   B) fall; fall   C) rise; fall   D) fall; rise     3. If the supply of money increases, what happens in the IS–LM framework?   A) The IS curve shifts right.   B) The LM curve shifts right.   C) The IS curve shifts left.   D) The LM curve shifts left.     4. If the demand for money increases, what happens in the IS–LM framework?   A) The IS curve shifts right.   B) The LM curve shifts right.   C) The…

Consider a closed economy where the goods and money markets are described by the following relationships: C = 200 + 0.9(Y – T) 1 = 400 – 15r M = 200 + Y – 100r G = 150 T = 100 M = 2000 P = 2 Where Cis planned consumption, / is planned investment spending, Tis government tax revenues, G is government purchases, M is the money supply, P is the price level and r is the interest rate. Department of Economics a) Derive the two expressions for the IS and LM equilibrium relationships respectively. Sketch a graph of the two relationships. b) Calculate the equilibrium value of output Y and interest rate r (round off your answers to one decimal point). Compute also the level of consumption and investment spending in equilibrium and check whether the actual level of spending matches the equilibrium level of output.

Expansionary monetary policy and contractionary fiscal policy has a combined effect which is ________.a. a decrease in interest rate and decrease in tax ratesb. an increase in interest rate and increase in tax ratesc. an increase government spending and decrease in money supplyd. an increase in tax rates and decrease in interest rates

2. In 2016 Obama's administration presented a new budget plan. It proposed an increase in BCA cap for defense spending by $54 billion in 2018 (more than a 10% rise in defense spending compared to the previous budget): a. Determine the effects of the policy on the Keynesian cross and loanable funds market. Explain, use graphs and math. b. What would be the effect on national income and interest rate in the short run. Use IS-LM, graph, math, and explain. c. What might happen with the level of prices? Use the AD-AS model and use the graph. d. Taking into account what happened to prices and what you answered in question c above, please explain how the Fed might react to this policy. Use graphs and explain.

To fix a negative supply shock in an economy, ___________should be used.   a.  contractionary monetary policy b.  demand-side fiscal policy c.  supply-side fiscal policy

Fiscal and Monetary Stimulus A. Create a graph of equilibrium in the IS-LM model. Show the effect of an expansionary monetary policy. Summarize your results. B. If the central bank’s goal is to maximize output, what interest rate will we expect in equilibrium? C. Starting from the equilibrium described in (B), suppose investors experience a decrease in “animal spirits.” What happens to output? Can the central bank offset this with expansionary monetary policy? D. What could fiscal authorities do to offset the shock to animal spirits described in (C)?

17. In the Keynesian model, an expansionary monetary policy will lead to * O Lower real interest rates and more investment Higher real interest rates and higher real income Higher real interest rates and lower prices O Lower real interest rates and lower prices Вack Next Clear form TOSHIBA

Please help me with 29 with explanation

A traditional liquidity trap is problematic for a New Keynesian policymaker because there is a   A. negative output​ gap, but the interest rate target remains too low.   B. negative output​ gap, but the nominal interest rate cannot go below zero.   C. positive output​ gap, but the nominal interest rate cannot go below zero.   D. strong incentive to create deflation in the long run.   E. strong incentive to create inflation in the long run.