In the IS-LM Model, a Decrease in Government Purchases Leads

question 29

Multiple Choice

In the IS-LM model, a decrease in government purchases leads to a(n) _ in planned expenditures, a(n) _ in total income, a(n) in money demand, and a(n) _ in the equilibrium interest rate.

• A)decrease; decrease; decrease; decrease
• B)increases; increase; increases; increase
• C)decrease; decrease; increase; increase
• D)increase; increase; decrease; decrease

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Definitions:

Correct Rejection

In signal detection theory, the decision to correctly identify the absence of a signal or stimulus.

Miss

To fail to hit, reach, catch, or otherwise make contact with something; can also refer to feeling sadness from the absence or loss of someone or something.

False Alarm

An error in which a warning or alert is given, but no actual threat or danger exists.

Noise Hit

In signal detection theory, an instance where a non-target stimulus is incorrectly detected as a target signal.