A decline in the money ________ shifts the LM curve to the ________,causing the interest rate to rise and output to fall,everything else held constant.
A)demand;right
B)demand;left
C)supply;right
D)supply;left

Question

Quizplus · Accepted Answer

A decline in the money supply shifts the LM curve to the left, causing the interest rate to rise and output to fall, as the reduced money supply increases the cost of borrowing.

A Decline in the Money ________ Shifts the LM Curve