Figure 4-6 -In the Figure Above, with IS0 Shifting to IS1, Movement

question 111

Multiple Choice

Figure 4-6
-In the figure above, with IS0 shifting to IS1, movement from points 0 to 2 requires the real money supply to ________.

• A) rise by the same percentage as income
• B) fall by the same percentage as income
• C) remain constant
• D) none of the above

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Definitions:

Mindlessness

A state of reduced cognitive awareness, often characterized by automatic or habitual actions without active engagement or reflection.

Mental Inflexibility

The inability or difficulty in adjusting one's thoughts, behaviors, or strategies in response to new information or changing circumstances.

Inertia

The resistance of any physical object to any change in its velocity, including changes to its speed or direction.

Obliviousness

The state of being unaware or unconscious of what is happening around one.