If the Economy Is on the IS Curve,but Is to the Right

question 63

Multiple Choice

If the economy is on the IS curve,but is to the right of the LM curve,aggregate output will ________ and the interest rate will ________.

• A)rise;rise
• B)rise;fall
• C)fall;rise
• D)fall;fall

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Definitions:

Population Means

The average value of a particular variable for the entire population, which provides a parameter that can be estimated through the use of sample means.

Pearson Correlation

A measure of the linear correlation between two variables X and Y, giving a value between +1 and -1 inclusive.

Covariance

A statistic that indicates the degree to which two variables vary together.

Nonlinear Relationship

A type of relationship between two variables where there is not a straight-line or proportional association.