701 #
© 2014 Pearson Canada Inc.#
The IS curve shifts to the left when ____.
A) taxes increase
B) government spending increases
C) the money supply increases
D) autonomous planned investment spending increases
Answer: A
Diff: 2 Type: MC Page Ref: 551
Skill: Recall
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
A decline in taxes ____ consumer expenditure and shifts the ____ curve to the
____, everything else held constant.
A) raises; LM; right
B) lowers; IS; left
C) raises; IS; right
D) lowers; LM; left
Answer: C
Diff: 2 Type: MC Page Ref: 551
Skill: Recall
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
A tax increase ____ disposable income, ____ consumption expenditure, and shifts
the IS curve to the ____, everything else held constant.
A) increases; increases; right
B) increases; decreases; left
C) decreases; increases; left
D) decreases; decreases; left
Answer: D
Diff: 2 Type: MC Page Ref: 551
Skill: Recall
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output
A tax cut ____ disposable income, ____ consumption expenditure, and shifts the
IS curve to the ____, everything else held constant.
A) increases; increases; right
B) increases; decreases; right
C) decreases; increases; left
D) decreases; decreases; left
Answer: A
Diff: 2 Type: MC Page Ref: 551
Skill: Recall
Objective List: 22.1 Utilize the Keynesian cross model for the determination of aggregate output