Figure 4 ​ Refer to Figure 4 Above

question 16

Multiple Choice

Figure 4 ​ Refer to figure 4 above. Assuming that Y₂ represents a level of national income lower than the full employment level, and that inflation has remained unchanged after the event that caused the IS curve to shift, what should the monetary authorities do if they wish to reduce unemployment?

• A) Increase money supply.
• B) Reduce money supply.
• C) Advise the government to raise taxes.
• D) Advise the government to reduce taxes.

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Definitions:

North America

A continent in the northern hemisphere, bounded by the Arctic Ocean, Atlantic Ocean, and the Pacific Ocean, comprising countries such as the USA and Canada.

Women

Female human beings, especially considered as a group, distinguished biologically and societally from men.

Doctorate Degrees

Advanced academic degrees awarded by universities, signifying mastery and high order overview in a specific field of study or professional practice.

North American

Pertaining to or relating to the continent of North America, which includes countries such as the United States, Canada, and Mexico.