The Economy Is in the Horizontal Portion of the AS Curve,there

question 45

Multiple Choice

The economy is in the horizontal portion of the AS curve,there is a liquidity trap,and investment spending is sensitive to changes in the interest rate.According to the Keynesian transmission mechanism,if the money supply increases the interest rate __________,investment spending __________,the AD curve __________ and the price level __________.

• A) falls; rises; shifts to the right; rises
• B) falls; rises; shifts to the right; remains unchanged
• C) does not change; does not change; does not change; does not change
• D) does not change; shifts to the left; does not change; rises
• E) rises; falls; left; falls

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Definitions:

Cultural Preferences

The tendencies of individuals from a particular culture to favor certain behaviors, dietary choices, health practices, or beliefs.

Ineffective Breathing Pattern

A condition characterized by an inadequate or unsatisfactory respiratory process, resulting in insufficient ventilation.

Alveolar-capillary Membrane

The thin tissue layer in the lungs where the exchange of oxygen and carbon dioxide takes place between air spaces and blood.

Pneumonia

A respiratory condition characterized by inflammation of the lungs, usually caused by infection with bacteria, viruses, or other organisms.