In the 1960s the IS curve
A) shifted to the right because of increased business optimism, tax reductions, and increased government spending.
B) shifted to the left because of increased business optimism, tax reductions, and increased government spending.
C) shifted to the right because of decreased business optimism, tax increases, and decreased government spending.
D) shifted to the right due to a decrease in interest rates.

Question

Quizplus · Accepted Answer

The IS curve shifts to the right in response to factors that increase aggregate demand, such as increased business optimism, tax reductions, and increased government spending, all of which were characteristic of the 1960s economic policies and environment.

In the 1960s the IS Curve