Chapter_5

Chapter_5 - Macroeconomics Test Yourself Chapter5 1. The IS...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Macroeconomics Test Yourself Chapter5 1. The IS curve tells us a. the single level of output where the goods market is in equilibrium. b. the single level of output where the money market is in equilibrium. c. the level of output for each different interest rate where the money market is in equilibrium. d. the level of output for each different interest rate where the goods market is in equilibrium. e. the unique level of output where both the goods market and the money market are in equilibrium. 2. Which of the following will shift the IS curve? a. a change in government spending. b. a change in taxes. c. a change in consumer confidence. d. all of the above. e. none of the above. 3. Which of the following occurs as we move rightward along the IS curve? a. A drop in the interest rate causes investment spending to increase. b. A drop in the interest rate causes money demand to increase. c. A drop in the interest rate causes the budget deficit to decrease. d. A rise in the interest rate causes the central bank to increase the money supply. e. A rise in the interest rate causes the demand for bonds to increase. 4. Which of the following will shift the LM curve? a. a change in the budget deficit. b. a change in output or income. c. a change in the money supply. d. all of the above. e. none of the above. 5. Which of the following occurs as we move rightward along the LM curve? a. A rise in the interest rate causes investment spending to decrease. b. A drop in the interest rate causes investment spending to increase. c. A rise in the interest rate causes the central bank to create more money. d. A rise in the interest rate causes the government to increase spending. e. A rise in the interest rate causes the demand for money to decrease. 6. If the economy is on both the LM curve and the IS curve, then we know that: a. the goods market is in equilibrium. b. the bond market is in equilibrium. c. the money market is in equilibrium. d. all of the above. e. none of the above.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Page 2 7. If the economy is on the LM curve but not on the IS curve, then we know that a. the goods market is in equilibrium, but not the money market. b. the money market and bond markets are in equilibrium, but not the goods market. c. the money market and goods market are in equilibrium, but not the bond market. d. the money, bond and goods markets are all in equilibrium. e. neither the money, bond, nor goods markets are in equilibrium.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 08/03/2008 for the course BUAD 350 taught by Professor Safarzadeh during the Summer '07 term at USC.

Page1 / 6

Chapter_5 - Macroeconomics Test Yourself Chapter5 1. The IS...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online