21.

An increase in the money supply and a drop in consumer confidence will lead toRequired to answer. Single choice.

(2 Points)

A decrease in output with an ambiguous effect on the interest rate.

An increase in output and a decrease in the interest rate.

A decrease in output and an increase in the interest rate.

An ambiguous effect on output and an increase in the interest rate

An ambiguous effect on output and a decrease in the interest rate.

22.

If the Fed's goal is to keep the interest rate fixed, a contractionary fiscal policy must be accompanied by ________ monetary policy that shifts the LM curve to theRequired to answer. Single choice.

(2 Points)

an expansionary, right

an expansionary, left

a contractionary, left

a contractionary, right

23.

A policy mix of a contractionary fiscal policy and a contractionary monetary policy will, unambiguously, result in a higher interest rate.Required to answer. Single choice.

(2 Points)

true

False