Looking Only at the Asset Market,an Increase in Output Would

question 65

Multiple Choice

Looking only at the asset market,an increase in output would cause

• A)the LM curve to shift down.
• B)the LM curve to shift up.
• C)an increase in real interest rates along the LM curve.
• D)a decrease in real interest rates along the LM curve.

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Definitions:

Systematic Risk

Systematic risk refers to the risk inherent to the entire market or market segment, often influenced by factors like economic, political, and social changes.

Beta

A measure of the volatility or systematic risk of a security or a portfolio compared to the market as a whole.

Unsystematic Risk

The risk associated with a specific company or industry, which can be mitigated through diversification.

Systematic Risk

The risk inherent to the entire market or market segment, which cannot be eliminated through diversification.