CUET-PG 2023 Shift 1 Question 72: IS-LM model

The demand for money $L = 0.25Y$ and the supply of money $\frac{M}{P} = 500$. In this case

1. the LM curve is vertical and defined by $Y = 2000$ and this defines the classical case
2. the LM curve is vertical and defined by $Y = 125$ and this defines the case of liquidity trap
3. the LM curve is upward sloping and defined by $Y = 2000$
4. the LM curve is horizontal and defined by $Y = 2000$ and this is a case of liquidity trap