In an economy undergoing financial innovations such as widespread use of ATM machine making money demand less elastic compared to pre-innovation times, one would expect
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UoH 2020 Question 30: IS-LM model
Answer and worked solution
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IS-LM model has come up 137 times in 7 exams since 2004.
What this question tests
This question is on Deriving the LM curve and its slope, part of IS-LM model in Macroeconomics.
How money market equilibrium gives an upward-sloping relation between interest rate and income.
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