Looking only at the asset market,an increase in output would cause
A)the LM curve to shift down.
B)the LM curve to shift up.
C)an increase in real interest rates along the LM curve.
D)a decrease in real interest rates along the LM curve.

Question

Quizplus · Accepted Answer

An increase in output leads to higher demand for money, which increases real interest rates along the LM curve, assuming the money supply is constant.

Looking Only at the Asset Market,an Increase in Output Would