An excellent way to learn about how changes in various factors affect the IS and LM curves

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An excellent way to learn about how changes in various factors affect the IS and LM curves is to visit www.fgn.unisg.ch/eurmacro/tutor/islm.html. This site, sponsored by the World Bank, allows you to make changes and to observe immediately their impact on the ISLM model.

a. Increase G from 200 to 500. What happens to the interest rate?

b. Reduce t to 0.1. What happens to aggregate output Y?

c. Increase M to 450. What happens to the interest rate and aggregate output?

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Related Book For  book-img-for-question

The Economics Of Money Banking And Financial Markets

ISBN: 9780321584717

4th Canadian Edition

Authors: Frederic S. Mishkin, Apostolos Serletis

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