Multiple Choice
If government purchases decrease, the IS curve will
A) shift to the left and intersect the FE line at a higher real interest rate.
B) shift to the right and intersect the FE line at a lower real interest rate.
C) shift to the left and intersect the FE line at a lower real interest rate.
D) shift to the right and intersect the FE line at a higher real interest rate.
Correct Answer:
Verified
Correct Answer:
Verified
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