IS-curve in the AS-AD model, Macroeconomics

Assignment Help:

The IS-curve in the AS-AD model

The IS-curve is not affected by P in the AS-AD model

We can define an IS-curve in the AS-AD model similarly to the IS-LM model: it will give us all combinations of R and Y where goods market is in equilibrium, which is, where aggregate demand is equal to GDP, YD(Y, R) = Y.

Since P doesn't affect any part of goods market, P won't affect the IS curve. IS curve in the AS-AD model is exactly the same as IS-curve in IS-LM model.


Related Discussions:- IS-curve in the AS-AD model

Goods services will be produced and sold in the us, Who decides what goods ...

Who decides what goods services will be produced and sold in the US? Ans) It is mostly the American consumer. The US government also plays a big role in the nation's economy, co

Investment, What are the basic differences between the investment curve and...

What are the basic differences between the investment curve and an investment demand curve for an economy

Macroeconomic policy issues facing the u.s. economy, While referring to the...

While referring to the "EYE on YOUR LIFE" section on, discuss the macroeconomic policy issues facing the U.S. economy today based on the economic concepts you have learned in this

Health care cost of capital, In 2004, Olentangy health care cost of capital...

In 2004, Olentangy health care cost of capital was 6%. Its investments on a historical cost valuation basis are $80,000; on a replacement cost basis are $100,000. And on a current

Trade liberalisation under wto, TRADE LIBERALISATION UNDER WTO: In  th...

TRADE LIBERALISATION UNDER WTO: In  the Uruguay Round negotiations, India agreed to reduce tariff on a  large number of  commodities and  remove quantitative restrictions (QRs

Effects in addition to the direct effect on dairy prices, Subsidy programs ...

Subsidy programs are likely to have a number of secondary effects in addition to the direct effect on dairy prices. What impact do you suppose farm subsidies are likely to have on

Define market for overnight loans, Q. Define market for overnight loans? ...

Q. Define market for overnight loans? The market for overnight loans Overnight interest rates are rates for loans over a single night - these are the shortest of all inte

Inflation, what are the causes of inflationary gap

what are the causes of inflationary gap

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd