In its February 18, 2010, edition, The Wall Street Journal stated, The dollar strengthened [. .

Question:

In its February 18, 2010, edition, The Wall Street Journal stated, “ The dollar strengthened [. . .] and stocks [. . .] followed suit. The Dow industrials rose 40.43 points, or 0.4%.”

a. What effect does the strengthened dollar have on the IS curve?

b. What effect does the increase in stock prices have on the IS curve?

c. What is the combined effect of these two events on the IS curve?

Stocks
Stocks or shares are generally equity instruments that provide the largest source of raising funds in any public or private listed company's. The instruments are issued on a stock exchange from where a large number of general public who are willing...

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