What causes the IS curve to shift? A. A shift in the IS curve occurs when equili

Question

What causes the IS curve to shift?

A. A shift in the IS curve occurs when equilibrium output changes at each given real interest rate. The factors of shifting are autonomous consumption, autonomous investment, and the real interest rate.

B. A shift in the IS curve occurs when the real interest rate changes at each given level of equilibrium output.

C. A shift in the IS curve occurs when equilibrium output changes at each given real interest rate. The factors of shifting are autonomous consumption, autonomous investment, autonomous net exports, taxes, and government purchases.

D. None of the above are correct.

Explanation / Answer

Answer:

C. A shift in the IS curve occurs when equilibrium output changes at each given real interest rate. The factors of shifting are autonomous consumption, autonomous investment, autonomous net exports, taxes, and government purchases.

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