Suppose k = 0.2. With a $200 billion increase in the money supply, the LM curve shifts

Question

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The shift in the LM curve due to a change in the money supply can be calculated using the formula ΔM / k, where ΔM is the change in the money supply and k is the money multiplier. Given k = 0.2 and ΔM = $200 billion, the shift is $200 billion / 0.2 = $1000 billion to the right, as an increase in the money supply decreases interest rates, moving the LM curve to the right.

Suppose K = 0