Assume That the FE Curve Is Flatter Than the LM

question 22

Multiple Choice

Assume that the FE curve is flatter than the LM curve. A negative internal shock shifts the IS curve leftward. Under zero sterilization, which one of the following will happen next?

• A)Because of the incipient balance of payments deficit, the LM curve will shift leftward
• B)Because of the incipient balance of payments surplus, the LM curve will shift rightward
• C)Because of the incipient balance of payments deficit, the IS curve will shift leftward
• D)Because of the incipient balance of payments surplus, the IS curve will shift rightward

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Definitions:

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The cessation of all biological functions that sustain a living organism.

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A health condition that persists for an extended period of time, often requiring ongoing medical attention or therapy.

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Characterizes an individual showing irritation or bad temper through gloomy silence or reserve, often indicative of moodiness or dissatisfaction.

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The act of law enforcement taking a person into custody, usually because there is reason to believe they have committed a crime.