Munich Personal RePEc Archive

Money Multipliers and the Slopes of IS and LM: Comment

Cebula, Richard (1984): Money Multipliers and the Slopes of IS and LM: Comment. Published in: Southern Economic Journal , Vol. 51, No. 3 (31. January 1985): pp. 906-908.

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Abstract

This theoretical model investigates the implications of the slopes of LM curves and positively sloped IS curves for the size of policy multipliers. It is shown that the effectiveness of monetary policy is greater if the slope of the IS curve is greater. It also is shown that fiscal policy effectiveness is greater the flatter the LM curve is.

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