Adding a Risk Premium to the Short-Run Model

question 14

Multiple Choice

Adding a risk premium to the short-run model:

• A)shifts the MP curve up.
• B)shifts the AD curve down.
• C)has no (direct)impact on the IS curve.
• D)a-c
• E)a and c only

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Definitions:

Artery Wall

The layer of tissue that forms the outer structure of an artery, made up of smooth muscle cells, connective tissue, and elastic fibers to withstand blood pressure.

Veins Overstretching

The condition where veins, typically those in the legs, are stretched beyond their normal capacity, often leading to varicose veins.

Middle Cerebral Artery

A major artery in the brain that supplies blood to the outer areas of the frontal, temporal, and parietal lobes.

Cerebral Cortex

The outer layer of neural tissue of the cerebrum of the brain, playing a key role in memory, attention, perception, awareness, thought, language, and consciousness.