Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

In an IS-LM model, if we assume that money demand is completely insensitive to changes in the interest rate A.) interest rates cannot be lowered

In an IS-LM model, if we assume that money demand is completely insensitive to changes in the interest rate

A.) interest rates cannot be lowered by fiscal policy

B.) fiscal policy can neither change the level of output nor the composition of GDP

C.) monetary policy can change income

D.) monetary policy is totally ineffective in changing the rate of interest

E.) the economy cannot be stimulated by fiscal or monetary policy

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essays In Economic Sociology

Authors: Max Weber, Richard Swedberg

1st Edition

0691218161, 9780691218168

More Books

Students also viewed these Economics questions

Question

Does this value make me feel good about myself?

Answered: 1 week ago