Why is money supply constant in the IS-LM model?

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  • Why is money supply constant in the IS-LM model?


Answer #1 | 23/12 2013 08:52
The money supply isn't constant in the model.
Positive: 67 %
Answer #2 | 23/12 2013 16:38
It is policy variable which can shift the LM curve, or monetary policy.
Positive: 61 %

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Chapter 22. IS-LM in ... IS-LM model to describe why panics have those ... abandoned money supply targeting in favor of interest rate targeting in ...
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Positive: 67 %
If Fed changes the money supply, ... and explain why. ... wants to raise investment but keep output constant. In the IS-LM model, ...
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Positive: 62 %
In the Money Supply chapter in our Introduction to Economics course we discussed how money supply is measured and the role of the Federal Reserve System ...
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Positive: 48 %
In the IS-LM model, ... it should be clear that output fluctuates less if the Fed follows a policy of keeping the money supply constant. ...
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Positive: 25 %

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