If the Intersection of the IS Curve with the Horizontal

question 28

Multiple Choice

If the intersection of the IS curve with the horizontal axis comes at a level of output below the natural level of output,the Fed

• A)can easily bring the economy back to the full-employment level of output.
• B)loses control of the economy.
• C)must use contractionary model policy to correct economic problem.
• D)must decrease money supply and ignore interest rates.

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Definitions:

Active Sites

The region on an enzyme where substrate molecules bind and undergo a chemical reaction.

Energy of Activation

The minimum quantity of energy that the reacting species must possess in order to undergo a specified reaction.

Coenzymes

Organic non-protein molecules that bind to enzymes and are essential for their catalyst activity.

Glucose

A simple sugar that is an important energy source in living organisms and is a component of many carbohydrates.