As Consumption Becomes More Sensitive to the Real Rate of Interest

Multiple Choice

As consumption becomes more sensitive to the real rate of interest,

A) the IS curve gets steeper and monetary policy grows more effective in manipulating GDP in the short run.
B) the IS curve gets flatter and monetary policy grows more effective in manipulating GDP in the long run.
C) the IS curve gets flatter and monetary policy grows more effective in manipulating GDP in the short run.
D) the IS curve is unaffe c t e d, but monetary policy grows we a ker nonetheless.
E) the IS curve gets steeper and monetary policy grows less effective in manipulating GDP in the long run.