When x decreasesSelect one:A.IS curve shifts to the left.B.LM curve shifts downward.C.LM curve shifts upward.D.IS curve shifts to the right.

Breakdown the Problem

1. Identify the Components: We should first understand what the IS and LM curves represent.
2. Analyze the Effect of Decrease in X: Determine how a decrease in X (which could represent income or output) affects the IS and LM curves.

Relevant Concepts

• IS Curve: Represents the relationship between interest rates and the level of income that equates total spending (demand) to total output (supply).
• LM Curve: Represents the relationship between interest rates and the level of income that equates money supply with money demand.

Analysis and Detail

1. When X (often understood as national income or output) decreases, spending tends to fall, leading to a leftward shift of the IS curve. This is because lower income results in less demand for goods and services.
2. The LM curve's position mainly depends on the money market, which is not directly influenced by the decrease in X.

Verify and Summarize

Based on the economic theory, a decrease in income (X) will move the IS curve to the left, as less output leads to lower demand in the economy.

Final Answer

A. IS curve shifts to the left.