IS/LM: Deriving Aggregate Demand (Part I: the IS Curve)

There are four articles on IS/LM: Synopsis Part 1: the IS curve (you are here) Part 2: the LM curve Part 3: combining the IS and LM curves The IS Curve There are several steps in creating the Investment-Savings (IS) curve, which has real aggregate income on the horizontal axis and real interest rate on […]