At points above the IS curve, there is an _____ and at points below the IS curve there is an _____.
A)excess demand for goods; excess supply of goods
B)excess demand for money; excess supply of money
C)excess supply of money; excess demand for money
D)excess supply of goods; excess demand for goods

Question

Quizplus · Accepted Answer

The IS curve represents equilibrium in the goods market. Above the IS curve, investment is less than savings, indicating an excess supply of goods. Below the IS curve, savings are less than investment, indicating an excess demand for goods.

At Points Above the IS Curve, There Is an _____