IS-LM model

• IS-LM model.

• What IS stands for?

• What LM stands for?

• What is a fiscal policy?

• Expansionary fiscal policy?

• Contractionary fiscal policy.

• Expansionary monetary policy.

• CB.

• How central bank can increase money supply in an economy.

• IS-LM model.

• What IS stands for?

• What LM stands for?

• Autarky.

• IS-LM-BOP.

• What’s the difference between IS-LM and Mundell-Flemming model?

• What Mundell-Flemming model argues?

• Free capital movement.

• Capital reserve.

• Perfect capital mobility.

• Consumption is positive function of what? And negative function of what?

• What r stands for?

• What equation Y=C+G+I stands for?

• Why consumption is a negative function of interest rate.

• Equation expressing the negative and positive function of consumption.

• Equation expressing negative and positive function of investment.

• Capital goods.

• What we can determine from IS curve?

• IS curve downward or upward sloping?

• How increase of interest rate affect consumption and investment.

• How decrease of interest rate effect consumption and investment.

• How increase of interest rate effect Y?

• How can issue of producing more than consuming can be fixed?

• What other factors than interest rate shifts IS curve?

• What equation M=L means?

• What M and L stands for in the equation M=L?

• What increases and decreases demand for money?

• Money demand equation.

• LM curve is upward or downward sloping?

• How to deal with an excess amount of money in the economy?

• How to deal with excess demand of money in the economy.

• If the money supply increases LM curve shifts to the right or left.

• What intersection of IS-LM curves indicates?

• What can be done if IS-LM curve is out of the equilibrium (bigger consumption, investment than money supply)?

• Does increase of Y affect C?

• Does increase in r affect C?

• When fiscal policy might be more effective.

• What are effects of expansionary monetary policy?

• If LM curve shifts to the right how does it affect Y, C, r and I?

• When monetary policy is more efficient.

• What is liquidity trap?

• Under liquidity trap is Lm curve steep or not?

• What differs Mundell-Flemming model from IS-LM model?

• How many curves has Mundell-Flemming model and which?

• Equation for savings.

• Equation for import.

• What is called leakage in Mundell-Flemming model?

• Under what factors IS curve shifts to the right in Mundell-Flemming model?

• Equation of balance of payments.

• In IS-LM model investment has inverse or positive function to interest rate?

• In Mundell-Flemming model CA has inverse and positive function to what.

• Why CA has inverse function to Y?

• What can offset CA deficit?

• BP curve is upward or downward sloping?

• When BP curve shifts to the right.

• What effects expansionary monetary policy has?

• How expansionary fiscal policy is financed?