Question

An expansionary monetary policy will shirt which curve in the IS-LM framework?

Why that curve?

Answer #1

An expansionary monetary policy will shift LM curve in the IS-LM framework to the right.

An expansionary fiscal policy will shift which curve in the
IS-LM framework? Why that curve?

examine the effect of an expansionary fiscal policy and
highlight its effectiveness in the IS-LM framework

Use the IS-LM framework to carefully explain how such an
expansionary fiscal policy, either tax cut or government spending
increase or both, affects the equilibrium output, interest rate and
investment.

In your opinion, which policy, the expansionary fiscal
policy, or the expansionary monetary policy, will be more effective
to recover the U.S. economy from the current downturn by COVID-19
pandemic? Why? Please state your answer in the language of
economics.

According to the IS-LM model, which of the following statements
is true?
a.
Contractionary monetary policy tends to decrease GDP and
decrease the interest rate.
b.
An increase in government expenditure tends to increase GDP and
increase the interest rate.
c.
Expansionary monetary policy reduces the monetary base in the
economy.
d.
None of the above.

Expansionary policy consist of either monetary policy or fiscal
policy. Explain expansionary monetary policy and its effect on
Aggregat Demand (with diagram)

5. Compare the effects of expansionary monetary and fiscal
policy on the interest rate in the IS-LM model. (5 points)

Suppose that in a closed economy the fiscal policy is
contractionary and monetary policy is expansionary, and the central
bank is setting the interest rates (LM is horizontal). Graphically
analyze this policy mix by using IS-LM diagram. What will be the
impact on real income and on interest rate in the short run? What
will be the impact of this policy mix on the economy in the medium
run? Show by using an AD-AS-LRAS diagram.

If the supply of money increases, what happens in the IS-LM
framework?
The LM curve shifts left.
The LM curve shifts right.
The IS curve shifts right.
The IS curve shifts left.

1) Briefly describe how an expansionary monetary policy policy
can be depicted on the graph of Demand Vs Supply for goods and
services (output for GDP), where the horizontal and vertical axes
are the Quantity (Q) and the price (P) of goods and services,
respectively.
2) Briefly describe how an expansionary monetary policy can be
depicted on the graph of Demand Vs Supply for money, where the
horizontal and vertical axes are the quantity and price of money
respectively. (Remember,...

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