Two Interpretations of the IS-LM Model Are That the Model

question 114

Multiple Choice

Two interpretations of the IS-LM model are that the model explains:

• A) the determination of income in the short run when prices are fixed, or what shifts the aggregate demand curve.
• B) the short-run quantity theory of income, or the short-run Fisher effect.
• C) the determination of investment and saving, or what shifts the liquidity preference schedule.
• D) changes in government spending and taxes, or the determination of the supply of real money balances.

Identify the ownership and structural details of the Federal Reserve District Banks.

Comprehend the various monetary policy tools used by the Federal Reserve and their frequencies of use.

Grasp the legal reserve requirements applicable to different types of deposits.

Describe the legal lending capabilities of individual banks.

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Definitions:

Current Account

A component of a country's balance of payments that measures the trade of goods and services, net earnings on investments, and transfer payments.

Goods Exports

The act of sending domestically produced goods to another country for sale or trade.

Current Account

A country's transactions with the rest of the world, including goods, services, income, and current transfers.

Net Inflow

Net inflow refers to the total incoming resources or capital minus the outgoing resources or capital in a particular time period.