Please check the answer and add explanation properly at every steps and solve steps wise How many of the following shifts the LM curve out? i ) open market sales by the central bank ii ) a rise in the discount rate iii ) prevention of using fin - techs in everyday transactions A ) none of i ) - iii )  B ) one of i ) - iii )  C ) two of of i ) - iii )  D ) all of i ) - iii )

Which of the following is most likely to occur in an economy where the central bank significantly lowers interest rates? A) An increase in consumer savings B) A decrease in investment by businesses C) An increase in consumer and business borrowing D) A decrease in overall economic activity

There has been an increase in the demand for liquidity (i.e. cash) due to  heightened uncertainty. Use the Currency in Circulation graph to answer the following questions. Do you think households increased cash holdings, proxied by money in circulation, due to the Covid-19 pandemic ? Discuss and justify your answer. Compare growth rates to justify your answer (e.g. Mar 2020- Mar 2021 look at month to month changes during the pandemic).

Suppose the economy has just entered a downturn due to a decrease in investment spending. While of the following actions could a central bank take to successfully counteract the downturn? a) Increase capital investment spending on the part of government agencies. b) Issue treasury bills in order to lower the interest rate. c) Buy back treasury bills in order to lower the interest rate. d) Buy back treasury bills in order to raise the interest rate. e) Lower the tax rate on real estate and capital gains assets

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Which of the following is TRUE about interest rates offered by financial Intermediaries? *A.The interest rates issued by financial intermediaries are standard across different financial institutions.B. Interest rates paid by DSUs are lower and SSUs are paid with higher interest rates.C. Interest rates issued by financial intermediaries are based solely on the issuance of central banks.D. Interest rates paid to SSUs are lower compared to the interest they collect to DSUs.

In the closed economy IS-LM model, how would the responsiveness of money demand to a change in output relate to the degree of crowding out after an increase in government spending?  Select one: a. The less responsiveness money demand is to a change in output, the greater the degree of crowding out after an increase in government spending b. If money demand is high then crowding out is high. c. The more responsiveness money demand is to a change in output, the greater the degree of crowding out after an increase in government spending d. The responsiveness of money demand to a change in output has no bearing on the degree of crowding out after an increase in government spending

The major problem facing the economy is high unemployment and weak economic growth. The inflation rate is low and stable. Therefore, the Federal Reserve decides to pursue a policy to increase the rate of economic growth. Which policy changes by the Fed would reinforce each other to achieve that objective? Multiple Choice sell bonds in the open market, raise the IORB and ON RRP rates, and transact reverse repos О sell bonds in the open market, raise the IORB and ON RRP rates, and engage in QT о raise the federal funds target range, transact reverse repos, and engage in QE о lower the federal funds target range, lower the interest on reverse balances rate, and engage in QE

Under what circumstances does a liquidity trap arise and why does it lead to a failure in the above mechanisms?

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