1. Which of the following explains the negative slope of the IS* curve?
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| B. |
| C. |
| D. |
2. According to the LM* curve,
| A. |
| B. |
| C. |
| D. |
3.In the Mundell-Fleming model, an increase in government spending under a floating exchange rate system will cause the real exchange rate to ____ and the level of output to ____.
| A. |
| B. |
| C. |
| D. |
4. . In the Mundell-Fleming model, an increase in income taxes under a fixed exchange rate system will cause the money supply to ____ and the level of output to ____.
| A. |
| B. |
| C. |
| D. |