Consider the IS-LM model for a closed economy and the following shock: consumers feel optimistic. 1. Draw the goods mark

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Consider The Is Lm Model For A Closed Economy And The Following Shock Consumers Feel Optimistic 1 Draw The Goods Mark 1 (97.53 KiB) Viewed 26 times

Consider the IS-LM model for a closed economy and the following shock: consumers feel optimistic. 1. Draw the goods market, money market, and IS-LM in equilibrium. Label all curves, axes and graphs. Use black colour for initial equilibrium. Label the initial equilibrium in each market with the letter "A". (0.5 marks) 2. Indicate market or markets where the shock originates (primary market or markets) with asterisk. Include on your graph the direct effect of the initial shock in all markets with green colour and label with the letter "B". (1 mark) 3. Include new equilibrium on your graph in all markets with red colour and label with the letter "C".(1 mark)