The IS/LM Model in Economica


Frequently in posts relating to economics, you will see the author refer to the IS curve or the LM curve.

WikiPedia has an article explaining what this is all about.  The following is the introduction:

The IS/LM model (Investment Saving/Liquidity preference Money supply) is a macroeconomic tool that demonstrates the relationship between interest rates and real output in the goods and services market and the money market. The intersection of the IS and LM curves is the “General Equilibrium” where there is simultaneous equilibrium in both markets.[1]

Go the the WikiPedia article to learn more.