Author Question: The IS curve slopes upward because a. as income rises, savings rise and consumption falls, ... (Read 87 times)

clippers! · **on:** Jun 30, 2018

The IS curve slopes upward because

a. as income rises, savings rise and consumption falls, decreasing output.
b. as interest rates rise, the money supply rises, increasing output.
c. as interest rates rise, planned investment must fall, increasing output.
d. as income increases, money demand rises, which increases interest rates.

Question 2

Theoretically, an increase in the real wage

A) increases leisure.
B) decreases leisure.
C) has an ambiguous effect on leisure.
D) has no effect on leisure.