Which of the following is an equilibrium condition in the ISLM model?

Question

Quizplus · Accepted Answer

In the ISLM model, the equilibrium condition is that desired investment equals desired saving. This is represented by the point where the IS curve (representing investment and saving in the goods market) intersects with the LM curve (representing money supply and demand in the market for money). At this point, the goods market and money market are in balance, and the economy is at equilibrium. None of the other options (labor market equilibrium, fiscal balance, or money supply and income relationship) are the equilibrium condition in the ISLM model.

Which of the Following Is an Equilibrium Condition in the ISLM