The IS Curve Would Unambiguously Shift Up If There Were

question 92

Multiple Choice

The IS curve would unambiguously shift up if there were

• A)an increase in both government purchases and corporate taxes.
• B)an increase in both government purchases and the expected future marginal product of capital.
• C)an increase in the expected future marginal product of capital and a decrease in expected future output.
• D)a decrease in both corporate taxes and the expected future marginal product of capital.

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Definitions:

Real GDP Growth Rate

The Real GDP Growth Rate measures the annual percentage increase in the value of all goods and services produced by an economy, adjusted for inflation.

Federal Reserve

The Federal Reserve is the central banking system of the United States, responsible for setting monetary policy and regulating financial institutions.

Monetary Policy

The actions undertaken by a central bank, such as the Federal Reserve, to control the supply of money and interest rates in order to achieve macroeconomic goals.

1990's

A decade characterized by major global events, technological advancements, and cultural shifts, lasting from 1990 to 1999.