The slope of the LM curve is determined by
A) the sensitivity of investment spending to the real interest rate.
B) the gap between the return on money and the market interest rate.
C) the effectiveness of monetary policy.
D) the sensitivity of the demand for real money balances to the nominal interest rate.
Correct Answer:
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Q51: An unexpected decrease in oil prices would
A)shift
Q52: If the demand for money is highly
Q53: If the demand for real money balances
Q54: A decline in real output causes the
Q55: At any point along the LM curve,
A)the
Q57: The LM curve slopes upward to the
Q58: An increase in real output causes the
Q59: Full-employment output can increase for all of
Q60: At a point below the LM curve,
A)there
Q61: An increase in expected inflation will
A)increase the
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