What would happen to the IS curve if the following happened (answer assuming only one thing happe…

What would happen to the IS curve if the following happened
(answer assuming only one thing happens at a time). Carefully
explain your reasoning.

Don't use plagiarized sources. Get Your Custom Essay on
What would happen to the IS curve if the following happened (answer assuming only one thing happe…
For as low as $13/Page
Order Essay

a. the marginal propensity to consume decreases

b. autonomous taxes rise

c. investment becomes less sensitive to the real interest rate
(d gets smaller)

d. consumption becomes more sensitive to the real interest rate
(c gets larger)   

e. taxes are collected partly as an income tax   (T =
(constant)T +tY) rather than being exogenous ( T= (constant) T)