In the Long-Run ISLM Model and with Everything Else Held

question 22

Multiple Choice

In the long-run ISLM model and with everything else held constant,the long-run effect of a tax cut is to ________ real output and ________ the interest rate.

• A)increase;increase
• B)increase;not change
• C)not change;increase
• D)not change;decrease

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Definitions:

Cognitive Ability Test (CogAT)

A standardized test designed to measure students' reasoning abilities in the areas of verbal, quantitative, and non-verbal (or spatial) reasoning.

Standard Error of the Estimate

A statistical measure that indicates the accuracy with which a sample represents a population.

GPA

Grade Point Average, a standardized measure of academic achievement within a specific period, calculated by dividing the total amount of grade points earned by the total amount of credit hours attempted.

Norm Referencing

A method of scoring in which test scores are compared to a group of other scores called the norm group.