The lectures and the textbook addressed some basic aspects of how the link between the monetary environment
Question:
The lectures and the textbook addressed some basic aspects of how the link between the monetary environment and the overall macroeconomic developments is modeled. The questions below concern this topic.
In the IS-LM model of the economy, the link between interest rates and equilibrium GDP depicted by the IS curve is ______________ and the link between interest rates and equilibrium GDP depicted by the LM curve is ______________.
a. positive; positive
b. positive; negative
c. negative; positive
d. negative; negative
In the IS-LM model of the economy, fiscal policy affects (shifts) the ______________, while monetary policy affects (shifts) the _______________.
a. IS curve; IS curve
b. IS curve; LM curve
c. LM curve; IS curve
d. LM curve; LM curve
One of the disadvantages of the structural models of the economy is that they do not allow for a detailed estimate of the potential effects of various policy actions.
True | False |
Business
ISBN: 978-0324829556
10th Edition
Authors: Willian M Pride, Robert J. Hughes, Jack R Kapoor