The LM Curve Slopes Upward Because

question 55

Multiple Choice

The LM curve slopes upward because

• A)as income rises,savings rise,increasing output.
• B)as interest rates rise,the money supply rises,increasing output.
• C)as interest rates rise,planned investment must fall,increasing output.
• D)as income increases,money demand rises,which increases interest rates.
• E)none of the above.

---

Definitions:

Primary

Refers to being of first importance; main or most significant in terms of consideration or development.

Non-Derivative

A non-derivative is a financial instrument without any underlying assets; its value is determined by the instrument itself, such as stocks or bonds, as opposed to derivatives like options or futures.

Derivative

A financial instrument whose value is derived from the value of another asset, which can include options, futures, and swaps.

Underlying Variable

A factor that can influence the outcome of a financial instrument or contract, such as interest rates, exchange rates, or commodity prices.