The IS curve represents
A)investment and saving when the commodity markets are in disequilibrium.
B)equilibrium in the commodity markets for every combination of interest rates and output level.
C)the determination of the level of interest rate.
D)the determination of the level of income and output.

Question

Quizplus · Accepted Answer

The IS curve represents equilibrium in the commodity markets for every combination of interest rates and output level, showing the relationship between the interest rate and the level of income that brings the goods market into equilibrium.

The IS Curve Represents