Suppose That a Change in the Fiscal/monetary Policy Mix Shifts

question 5

Multiple Choice

Suppose that a change in the fiscal/monetary policy mix shifts the IS and LM curves downward by exactly the same amount.The ________ in national saving is accompanied by ________ domestic investment due to the ________ in the interest rate.

• A)fall,equally lower,lower
• B)fall,unchanged,unchanged
• C)rise,unchanged,unchanged
• D)rise,equally higher,lower
• E)rise,equally lower,higher

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Definitions:

Price Competition

A market condition wherein businesses attempt to attract customers by lowering the price of their goods or services compared to competitors.

Differentiated Products

Goods or services that are distinguished from similar offerings by unique characteristics, brand, quality, or features.

Buyer Power

The influence that purchasers have over sellers in determining product pricing, quality, and terms of sale.

Value Capture

The process of retaining a portion of the value provided in every transaction, often seen in business and economic models.