Business, 18.01.2021 02:30 NerdyJason

Suppose that investment (1) in the goods market is not responsive
to the interest rate (that is, I do not
depend on the interest rate at all).
Then

Select one:
a. The is curve is a horizontal
line and monetary policy
does not affect output in the IS-LM
model
b. The IS curve is a vertical line
and monetary policy does not
affect output in the IS-LM model.
c. The IS curve is a vertical line
and monetary policy is very effective in raising output.
d. The IS curve is a horizontal
line and monetary policy is very
effective in raising output.

= The IS curve is a vertical line
and monetary policy does not
affect output in the IS-LM model.

Answers: 1

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Suppose that investment (1) in the goods market is not responsive
to the interest rate (that i...

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