Any change in the economic environment and economic policy that change the level of autonomous spending

Question

Quizplus · Accepted Answer

Changes in the economic environment and economic policy that affect the level of autonomous spending directly impact investment and consumption decisions, which are components of the aggregate demand. This leads to a shift in the IS curve, which represents combinations of interest rates and levels of output where the goods market is in equilibrium. The LM curve, representing money market equilibrium, is not directly affected by changes in autonomous spending.

Any Change in the Economic Environment and Economic Policy That