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    Principles of Macroeconomics Study Set 11
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    Exam 12: The Determination of Aggregate Output, the Price Level, and the Interest Rate
  5. Question
    Show the Impact on the IS Curve of an Increase
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Show the Impact on the IS Curve of an Increase

Question 36

Question 36

Essay

Show the impact on the IS curve of an increase in government spending. Make sure to draw in the LM curve as well and illustrate the impact on the equilibrium interest rate and the aggregate output level.

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