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28. In which country did nominal interest rates drop slightly below zero percent in 2012? A) DenmarkB) GermanyC) IrelandD) JapanE) United States 24.A / 25.D / 26.A / 27.C / 28.A5
29. Crowding out occurs when30. In a normal IS-LM framework, crowding out may be avoided if31. In an IS-LM framework, fiscal expansion generally leads to income expansion 32. The crowding out effect is zero ifA) the LM-curve is horizontalB) the LM-curve is verticalC) the central bank conducts open market sales following fiscal expansionD) income is stimulated via a tax cut rather than an increase in government spendingE) none of the above33. Crowding out34. Assume the government wants to increase the level of consumption and investment. Which of the following policies should be implemented?29.C / 30.C / 31.D / 32.A / 33.E / 34.A6
35. Given a normal IS-LM model, which of the following is FALSE?