All Points on the IS Curve Represent Combinations of Interest

question 30

Multiple Choice

All points on the IS curve represent combinations of interest rates and GDP supported by the condition that

• A) the sum of private and public saving falls short of investment by an amount equal to the multiplier.
• B) the sum of private and public saving just equals investment.
• C) the sum of private and public saving exceeds investment by an amount equal to the multiplier.
• D) the demand for money matches the supply of money.
• E) the supply of money just finances the quantity of investment that people intend to undertake.

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