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Which of the following factors leads to a flatter LM curve in the IS-LM model?
  • a)
    Higher interest elasticity of money demand
  • b)
    Lower interest elasticity of money demand
  • c)
    Higher interest rates
  • d)
    Lower money supply
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
Which of the following factors leads to a flatter LM curve in the IS-L...
A higher interest elasticity of money demand results in a flatter LM curve, indicating that changes in interest rates have a relatively larger impact on money demand.
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Which of the following factors leads to a flatter LM curve in the IS-LM model?a)Higher interest elasticity of money demandb)Lower interest elasticity of money demandc)Higher interest ratesd)Lower money supplyCorrect answer is option 'A'. Can you explain this answer?
Question Description
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