In the IS-LM model, the LM curve represents the equilibrium in which

Mac Quiz #2

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Anupama Panta
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15 questions
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1.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
Goods market is in equilibrium.
Money market is in equilibrium.
Both goods and money markets are in equilibrium.
Fiscal policy is effective in stabilizing the economy.
2.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
An increase in government spending in the IS-LM model will
Shift the IS curve to the left.
Shift the IS curve to the right.
Shift the LM curve to the left.
Shift the LM curve to the right.
3.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
In the IS-LM model, an increase in the money supply, assuming prices are sticky, will most likely result in
A lower level of output and interest rates.
A higher level of output and interest rates.
A higher level of output and lower interest rates.
A lower level of output and higher interest rates.
4.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
How would the IS-LM model likely respond to an unexpected increase in oil prices due to geopolitical tensions?
IS curve shifts to the left, LM curve shifts to the left.
IS curve shifts to the left, LM curve shifts to the right.
IS curve shifts to the right, LM curve shifts to the left.
IS curve shifts to the right, LM curve shifts to the right.
5.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
Suppose a country experiences a boom in its technology sector, leading to increased investment and productivity gains. In the IS-LM model, this scenario is most likely to result in
A shift in the LM curve to the left.
A parallel shift of both IS and LM curves to the right.
A shift in the IS curve to the right.
A shift in the IS curve to the left.
6.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
In the context of the Phillips curve model, which scenario best illustrates a supply-side shock affecting inflation and unemployment?
A sudden increase in consumer spending due to government stimulus.
A significant rise in oil prices following geopolitical tensions.
Expansionary monetary policy aimed at lowering interest rates.
An increase in minimum wage mandated by legislation.
7.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
According to the Phillips curve model, how would a prolonged period of economic growth with low unemployment likely affect inflation?
Inflation is likely to decrease due to increased productivity.
Inflation is likely to remain stable as demand matches supply.
Inflation is likely to increase as demand outpaces supply.
Inflation is likely to decrease as firms cut prices to attract workers.
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