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Determine whether the following changes to the economy are examples of financial, spending, or supply shocks and whether the

MP$,$ IS$,$ or Phillips curves shift.

Financial shock $-$ MP curve shifte

Answer Bank

a$.$ The Chinese government eliminates the tariffs it charges on goods exported from the United States.

b$.$ The implementation of artificial intelligence in manufacturing has led to faster than expected productivity growth, which results in decreasing production costs.

c$.$ A financial crisis makes banks extremely reluctant to take on risky loans without charging an extremely high risk premium.

d$.$ Businesses' confidence about the future of the economy falls, which leads them to scrap planned investment projects.