Multiple Choice
When the multiplier is included in the IS curve,
A) a demand shock has a larger impact on short-run fluctuations than with the standard IS curve.
B) it has no impact on potential output.
C) a demand shock has a smaller impact on short-run fluctuations than with the standard IS curve.
D) a change in taxes has no impact on short-run output.
E) a and b are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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