The Foundation of the IS Curve Is the Equation ________ $Y _ { t } = C _ { t } + I _ { t } + G _ { t } + E X _ { t } - L M _ { t }$

question 108

Multiple Choice

The foundation of the IS curve is the equation ________, which is the ________.

• A) \(Y _ { t } = C _ { t } + I _ { t } + G _ { t } + E X _ { t } - L M _ { t }\) ; national income identity
• B) \(Y _ { t } = C _ { t } + I _ { t } + G _ { t } + L M _ { t }\) ; national income identity
• C) \(Y _ { t } = C _ { t } + I _ { t } + G _ { t }\) ; national income identity
• D) \(Y _ { t } = C _ { t } + I _ { t } + G _ { t } + E X _ { t } - L M _ { t }\) ; current account
• E) \(Y _ { t } = C _ { t } + I _ { t } + G _ { t } + L M _ { t } - E X _ { t }\) ; current account

---

Definitions:

Positive

A term usually referring to values greater than zero, or a positive attitude or outcome in a broad sense.

Expected Value

The weighted average of all possible values of a random variable, with the weights being the probabilities of the outcomes.

Portfolio

A blend of financial contributions, featuring stocks, bonds, market commodities, ready money, and equivalents of cash, comprising also mutual funds and ETFs.

Stocks

Shares of ownership in a corporation or financial asset, which represent a claim on the company's earnings and assets.