Explain how each of the following will shift the IS curve. (a) The decline in sales of
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(a) The decline in sales of American agricultural products to foreign countries resulting from a strong U.S. dollar in the early to mid-1980s.
(b) The collapse in consumer confidence that occurred in the fall of 1990 following the rapid rise in energy prices after Iraq’s invasion of Kuwait in August 1990.
(c) The drop in business confidence following the collapse of the stock market and the Internet bust in 2000.
(d) The increased reluctance by some banks to make car and housing loans following the financial crisis of 2007–08.
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a The decline in sales of American agricultural exports reduces net exports Therefore autonomous pla...View the full answer
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