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The LM Curve Will Be Vertical and Fiscal Policy Ineffective

Question 26

Multiple Choice

The LM curve will be vertical and fiscal policy ineffective when


A) the demand for money is unaffected by changes in the interest rate.
B) the demand for money is unaffected by changes in income.
C) investment is unaffected by changes in the interest rate.
D) investment is unaffected by changes in income.

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