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Question 1 Answer saved Marked out of 1.00 p Flag question A decrease in the interest rate will increase the level of investment spending since Select one: a. the return on private saving will decrease. b. the cost of borrowing will decrease. c. the value of government bonds will decrease. d. All of the above. Question 2 Answer saved Marked out of 1.00 p Flag question Any position that is to the left of (and above) the LM-curve indicates that there is Select one: a. excess demand for money. b. excess supply of goods and services. O C. excess supply of money. d. excess demand for goods and services. Question 3 Answer saved Marked out of 1.00 p Flag question Any position that is to the right of (and above) the IS-curve indicates that there is Select one: 0 a. excess supply of goods and services. O b. excess demand for goods and services. O C. excess supply of money. O d. excess demand for money. Question 4 Answer saved Marked out of 1.00 Flag question If money demand becomes less sensitive to interest rate changes, the LM-curve will Select one: O a. become steeper. O b. become flatter. O C. shift to the right. O d. remain unaffected. Question 5 Answer saved Marked out of 1.00 p Flag question In an IS-LM framework, an increase in autonomous saving will result in Select one: O a. a decrease in both income and the interest rate. O b. a decrease in income but an increase in the interest rate. O c. a decrease in investment. 0 d. an increase in both income and the interest rate. Question 6 Answer saved Marked out of 1.00 p Flag question In an IS-LM framework, expansionary monetary policy will Select one: O a. increase the size of the budget deficit. b. increase both income and the interest rate. O C. increase both consumption and investment. O d. increase saving and decrease consumption. Question 7 Answer saved Marked out of 1.00 p Flag question In an IS-LM model, a decrease in the income tax rate will Select one: O a. decrease the expenditure multiplier. O b. increase output and the interest rate. c. make the IS-curve steeper. O d. increase consumption and decrease the interest rate. Question 8 Answer saved Marked out of 1.00 P Flag question The AD-curve will shift to the right if Select one: O a. real money balances increase due to a decrease in the price level. O b. the central bank restricts nominal money supply. O C. autonomous saving increases. d. government transfer payments are increased. The equation i = (k/h)Y - (1/h)(Mo/Po) best describes Select one: a. None of the above O b. the LM-curve. O c. the AD-curve. d. the IS-curve. Question 10 Not yet answered Marked out of 1.00 p Flag question The equation: i = (1/b)AO - (b/a)Y best describes Select one: a. the LM-curve. b. the IS-curve c. the AD-curve. d. None of the above