Which of the Following Is TRUE as We Move Along

question 20

Multiple Choice

Which of the following is TRUE as we move along the IS-curve?

• A)a lower interest rate is compatible with a higher equilibrium output level
• B)a higher equilibrium output level is compatible with a higher interest rate
• C)a lower equilibrium income level is compatible with a higher level of transactions demand for money
• D)a higher interest rate is compatible with a higher level of equilibrium income and therefore a higher level of consumption
• E)a higher interest rate is compatible with higher asset prices and therefore a higher level of saving

---

Definitions:

Brokers

The people who organize transactions between buyers and sellers.

Money

A medium of exchange in the form of coins and banknotes; used to purchase goods and services or measure value and wealth.

Revenue

The income that a business earns from its normal business activities, usually from the sale of goods and services to customers.

Income

Money received, especially on a regular basis, for work or through investments.