a. Lenders become less risk averse and cut the premium they charge when making risky loans. IS-MP graph spending shock financial shock MP curve Real interest rate (55) IS curve Output gap (5) In Sur. TUR Question 12 of 16 > IS-MP graph b. The federal government ends a long-standing tax cut for families with small children spending shock financial shock MP curve Real interest rate (5) IS cune Output gap (5) Question 12 of 16 > IS-MP graph c. Congress passes a new tax law that decreases corporate taxes by 10% spending shock financial shock (1) MP curve Real interest rate (6) IS curve Output gap 19 d. The Fed decides to raise rates. IS-MP graph financial shock spending shock MP curve Real interest rate (5) IS Output pap () IS-MP graph e. Electric power providers become more confident in the ability for wind farms to meet electricity demand. This leads to a boom in building and producing wind farms across the country financial shock spending shock MP curve Real interest rate) 15 Output gap