IS-LM

The economy of Hicksonia stays in simultaneous equilibrium: the goods & services market and money market are in equilibrium. The macroeconomic shocks pushed this economy to new equilibria states characterized by points 1-6.

2. IS-LM The economy of Hicksonia stays in simultaneous equilibrium: goods & services market and money market are in equilibrium. The macroeconomic shocks pushed this economy to new equilibria states characterized by points 1-6. 2.a Y r Ya C 3040 26,00% 3000 2700 40 1 3084 27,1 1% 3044 2736 29 2. 3076 26,89% 3056 2744 31 3 2996 24,89% 2956 2664 51 4. 3004 25,11% 2944 2656 49 5. 3151 23,78% 3111 2789 62 6. 2929 28,22% 2889 2611 18 2.b Y C 3596 14,89% 3556 3144 151 1 3707 12,67% 3667 3233 173 2. 3560 14,00% 3500 3100 160 3. 3640 16,00% 3600 3180 140 4 3551 13,78% 3511 3109 162 5 3631 15,78% 3611 3189 142 6. 3484 17,11% 3444 3056 129 Try to name the shock in each case. Possible answers: money supply (M) 1/4; government expenditures (G) 1/4; taxes (T) 1/4 Answers: 2.a.: 1. GT, 2. T4. 3. GI. 4. TT. 5. MT. 6. MJ. 2.b.: 1. MT. 2. TT, 3. GT. 4. GI, 5. T4, 6. MJ