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International Economics, 7e (Husted/Melvin)Chapter 21 Open Economy Macroeconomic Policy and AdjustmentMultiple-Choice Questions1) Which of the following would not cause the IS curve to shift to the left? A)a decrease in government expenditures B)a decrease in the money supply C)an increase in the domestic price level D)an increase in taxes Answer: B 2) The LM curve represents combinations of income and interest rate which 3) A point to the left of the BP curve would represent A)1
4) An increase in the money supply would 5) A point to the left of the LM curve would represent a situation in which A)money demand is greater than money supply. B)money supply is greater than money demand. C)money demand is greater than goods demand. 2
D)money demand is less than goods demand. Answer: B 6) Which of the following is not a true statement?