The SRAS Curve Is Upward Sloping,there Is a Liquidity Trap,and

question 149

Multiple Choice

The SRAS curve is upward sloping,there is a liquidity trap,and investment spending is sensitive to changes in the interest rate.According to the monetarist transmission mechanism,if the money supply increases the AD curve __________ and the price level __________.

• A) does not change; does not change
• B) shifts to the left; falls
• C) shifts to the right; rises
• D) does not change; rises
• E) none of the above

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Definitions:

CIA

The Central Intelligence Agency, a civilian foreign intelligence service of the federal government of the United States, tasked with gathering, processing, and analyzing national security information.

Korean War

A conflict between North Korea, with military support from China and the Soviet Union, and South Korea, supported by forces from the United Nations, especially the United States, lasting from 1950 to 1953.

Yalu River

The river that forms the border between North Korea and China, known for being a significant site during the Korean War when Chinese forces crossed it to assist North Korea.

U.N. Forces

Military and peacekeeping troops contributed by member countries of the United Nations, used in various conflict zones to enforce peace agreements and provide stability.