Fiscal policy will have a smaller effect
in the ISLM model than in a simple income-expenditure
the accelerator does not work in the ISLM model.
the ISLM model introduces lags into the adjustment
fiscal policy can crowd out some
the marginal propensity to save is
unstable in the ISLM model.
In terms of the ISLM model, if people
become less thrifty, their actions should move
IS curve left.
IS curve right.
LM curve right.
LM curve left.