The LM Curve Slopes Upward to the Right Because

question 20

Multiple Choice

The LM curve slopes upward to the right because

• A)the demand for money plus the demand for nonmoney assets must equal the supply of money plus the supply of nonmoney assets.
• B)a higher real interest rate is associated with a higher level of the output gap in money market equilibrium.
• C)a higher real interest rate is associated with a higher level of saving in goods market equilibrium.
• D)in equilibrium the actual real interest rate must increase one-for-one with expected real interest rate.

---

Definitions:

Displacement

A term referring to things and events removed in time and space.

Linguistic Relativism

The concept that the structure and vocabulary of a language influence its speakers' perception and categorization of the world.

Contrasting Tones

Employing distinctly different pitches, colors, or attitudes in speech, writing, art, or music to highlight differences or create effects.

Whistling

Producing a high-pitched sound by forcing air through a small hole formed by the lips, teeth, or objects, often used as a form of communication or musical expression.