In the IS-MP analysis in the Fed model, a decrease in the risk-free rate shifts the:
A)IS curve to the left.
B)IS curve to the right.
C)MP curve up.
D)MP curve down.

Name: In the IS-MP analysis in the Fed model, a decrease in the risk-free rate shifts the: A)IS curve to the left. B)IS curve to the right. C)MP curve up. D)MP curve down.
Brand: Quizplus
Rating: 4.8 (35 reviews)

Question

Quizplus · Accepted Answer

A decrease in the risk-free rate typically leads to a downward shift in the MP (Monetary Policy) curve, as it reflects a more accommodative monetary policy stance.

In the IS-MP Analysis in the Fed Model, a Decrease