In the liquidity preference model, a monetary expansion causes _______ to ______

Question

In the liquidity preference model, a monetary expansion causes _______ to ________.

A) interest rates; decrease B) interest rates; rise
C) money demand; decrease D) the money supply; decrease

In the simple Keynesian model, an increase in government spending would cause aggregate demand and output to _______ because of the ________ effect.

A) not change; crowding out
B) increase by more than the change in government spending; multiplier

C) increase by more than the change in government spending; magic

D) increase by less than the increase in government spending; deficit

Explanation / Answer

1: B

2: B

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.