Economy, asked by bhaveshdixit4160, 5 hours ago

how and why the multiplier and the interest sensivity of aggregate demand affect the slope of the IS curve ?

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Answered by mustafakakar998
0

Answer:

If investment spending is very sensitive to interest rate, then a given change in the interest rate produces a large change in aggregate demand, and thus shifts the aggregate demand curve up by a large distance. ... Given that the slope of the IS curve depends on the multiplier; fiscal policy can affect that slope.

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