21) The slope of the LM curve will be flatter the __________ is the income-sensitivity of the demand for money and the __________ is the interest-sensitivity of the demand for money. A) less; less B) less; greater C) greater; less D) greater; greater 22) Which of the following will cause the LM curve to shift to the right? A) An increase in investment B) An increase in money demand C) A decrease in velocity D) An increase in the money supply 23) Which of the following will cause the LM curve to shift to the left? A) A decrease in investment B) A decrease in money demand C) An increase in velocity D) A decrease in the money supply 24) An increase in money demand will shift the A) IS curve to the left. B) IS curve to the right. C) LM curve to the left. D) LM curve to the right. 25) A decrease in money demand will shift the A) IS curve to the left. B) IS curve to the right. C) LM curve to the left. D) LM curve to the right. 26) A rising GDP causes __________ the money demand curve. A) downward movement along B) upward movement along C) a rightward shift of D) a leftward shift of 27) A falling GDP causes __________ the money demand curve. A) downward movement along B) upward movement along C) a rightward shift of D) a leftward shift of 28) At any point above the current LM curve, there is an A) excess demand for money. B) excess supply of money. C) excess demand for goods. D) excess supply of goods. 29) At any point below the current LM curve there is an A) excess demand for money. B) excess supply of money. C) excess demand for goods. D) excess supply of goods. 30) Suppose k = 0.2. With a $200 billion increase in the money supply, the LM curve shifts A) to the right by $40 billion. B) to the left by $160 billion. C) to the left by $200 billion. D) to the right by $1000 billion. 31) Suppose k = 0.25. With a $10 billion decrease in the money supply, the LM curve shifts A) to the left by $40 billion. B) to the left by $4 billion. C) to the left by $2.5 billion. D) to the right by $0.25 billion. 32) The LM curve becomes steeper if there is __________ in the interest-sensitivity of __________ demand. A) an increase; money B) an increase; investment C) a decrease; money D) a decrease; investment