Figure 4 -Refer to Figure 4 Above.Figure 4 Shows the IS-LM Model.Which

question 26

Multiple Choice

Figure 4

-Refer to Figure 4 above.Figure 4 shows the IS-LM model.Which of the following statements about the figure is NOT true?

• A)The figure shows the economy would be in general equilibrium when the interest rate is i1 and the level of national income is Y₁.
• B)The figure shows that an expansionary monetary policy will lead to an increase in national income and an increase in interest rates.
• C)The figure shows that an expansionary fiscal policy will lead to an increase in national income and an increase in interest rates.
• D)The figure shows the effect of an increase in autonomous expenditure.

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Definitions:

Positive Correlation

A relationship between two variables where an increase in one variable is associated with an increase in the other variable.

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The influence of external factors like environment and upbringing on the development and behavior of an individual.

Development

is the process of change and growth over time, which can include physical, cognitive, emotional, and social aspects.