Method of Derivation of the IS and LM Curves (With Diagram)
In this article we will discuss about the method of derivation of the IS and LM curves, explained with the help of suitable diagrams. (a) Derivation of the IS curve: The IS curve is frequently derived graphically with a four-part diagram as shown in Fig. 13. Employing simple linear functions, part (a) of Fig. 13 is a plot of the [...]