A Steep LM Curve Implies That

question 2

Multiple Choice

A steep LM curve implies that

• A)an increase in government spending will change output by a relatively small amount.
• B)a decrease in taxes will change output by a relatively small amount.
• C)changes in government spending and taxes will have a large multiple effect on output.
• D)A and B.

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Definitions:

Systematic observation

An observational research method where data are collected in a structured and organized manner to study phenomena as they naturally occur.

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Common theme

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