A change in income in the IS-LM model for a fixed price represents a
A)shift in the aggregate demand curve. represents a movement along the aggregate demand curve.
B)has the same effect on the aggregate demand curve as a change in income in the IS-LM model resulting from a change in the price level.
C)does not represent a change in the aggregate demand curve.
D)and the interest rate in both the short and long runs.

Question

Quizplus · Accepted Answer

A change in income in the IS-LM model for a fixed price represents a shift in the aggregate demand curve because it affects the equilibrium level of output and interest rates, altering the overall demand in the economy.

A Change in Income in the IS-LM Model for a Fixed