If money demand does not depend on income, then the ______ curve is ______.
A) IS; vertical
B) IS; horizontal
C) LM; vertical
D) LM; horizontal

Name: If money demand does not depend on income, then the ______ curve is ______. A) IS; vertical B) IS; horizontal C) LM; vertical D) LM; horizontal
Brand: Quizplus
Rating: 4.9 (34 reviews)

Question

Quizplus · Accepted Answer

If money demand does not depend on income, the LM curve is horizontal because changes in income do not affect the interest rate, given the money supply.

If Money Demand Does Not Depend on Income, Then the ______