A Vertical IS Curve Comes from the Assumption That Changes

question 24

Multiple Choice

A vertical IS curve comes from the assumption that changes in the interest rate do NOT affect

• A)money demand.
• B)the money supply.
• C)autonomous planned spending.
• D)the LM curve.

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Definitions:

Social Contract Theory

A theory in political philosophy that posits the legitimacy of the authority of the state over the individual is grounded in a hypothetical contract between them.

Wason Selection Task

A logical puzzle used as a test in psychology to study conditional reasoning and confirmation bias.

Syllogistic Reasoning

A form of logical reasoning that uses deductive reasoning to arrive at a conclusion based on two or more propositions that are asserted or assumed to be true.

Desirability

The quality of being wanted or wished for due to appealing attributes or qualities.