Assignment 7 - Answer Key

Assignment 7 - Answer Key - Assignment 7 Answer Key Due Apr...

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Assignment 7 Answer Key Due Apr. 8 th Multiple choices 1. The variable that links the market for goods and services and the market for real money balances in the IS-LM model is the: A. consumption function. B. interest rate. C. price level. D. nominal money supply. (B) 2. In the IS-LM model, which two variables are influenced by the interest rate? 3. The IS curve plots the relationship between the interest rate and ______ that arises in the market for ______. (A) 4. For the purposes of the Keynesian cross, planned expenditure consists of: 5. In the Keynesian-cross model, actual expenditures equal: A. GDP B. the money supply. C. the supply of real balances. D. unplanned inventory investment. (A) 6. When planned expenditure is drawn on a graph as a function of income, the slope of the line is:
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(B) 7. The equilibrium condition in the Keynesian-cross analysis in a closed economy is: (C)
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