Ask Question
BusinessBusiness
20 October, 17:34

During 2008 in the United States, consumer confidence fell significantly. Which of the following will occur as a result of this reduction in consumer confidence?

A) the LM curve will shift up.

B) the LM curve will shift down.

C) the IS curve will shift rightward.

D) the IS curve will shift leftward.

E) the IS curve will shift rightward, and the LM curve will shift up.

+2
Answers (1)
  1. 20 October, 20:25
    0
    The correct answer is option D.

    Explanation:

    A reduction in consumer confidence will cause the IS curve to move leftwards. The IS curve is short for the investment savings curve. It shows the equilibrium in the goods market. It shows different combinations of interest rates and income where the goods market is in equilibrium.

    A change in consumer spending causes a shift in the IS curve. A reduction in consumer confidence will cause consumers to spend less. This reduction in consumer spending will further cause the IS curve to shift to the left.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “During 2008 in the United States, consumer confidence fell significantly. Which of the following will occur as a result of this reduction ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
A spreadsheet is the best choice to keep track of employees' work hours and salary for computing the payroll. identify voters who will receive political literature for the party to which they belong.
Answers (1)
Using the constant growth model, Camp Company's expected dividend yield (D1) is 4% of the stock price, and its growth rate is 6%. If the tax rate is 35%, what is the firm's cost of equity?
Answers (1)
The Gordon dividend discount model: A. assumes that dividends increase at a decreasing rate. B. can only value stocks at time 0. C. cannot be used to value constant dividend-paying stocks. D.
Answers (1)
The Times article notes that three days after the ACP awarded a $158 million contract to the Spanish firm that manufactures the tugboats, the son of the canal administrator joined the law firm representing the tug - boat manufacturer.
Answers (1)
You have a balance of $4,500 on your credit card. the interest rate is 12% (1% per month). the late payment fee is $40. you miss a payment. what are your fees plus interest for the month? a. $40 b. $45 c. $65 d. $85
Answers (1)
New Questions in Business
Minimum wage laws have the smallest effect on which segment of the labor force? a. low-skilled labor b. teenagers c. skilled workers d. unemployed workers
Answers (1)
A retailer buys a painting for $200. she sets the selling price at $450. when the painting doesn't sell after two months, she raises the price to $800 to appeal to a different market. the painting sells for $800 the next day.
Answers (1)
Kathy Brooks is a franchisee who wishes to donate her old HRB workstations and server to a local charity for a fundraising auction.
Answers (1)
True or false Every risk an individual faces can be insured
Answers (2)
What are the advantages of using internal financing?
Answers (1)
Home » Business » During 2008 in the United States, consumer confidence fell significantly. Which of the following will occur as a result of this reduction in consumer confidence? A) the LM curve will shift up. B) the LM curve will shift down.
Sign Up Forgot Password?