Hi everyone,
I figured out how IS curve would shift after an increase in government spending (with (G - T) + (X - M) shifting to the right), can someone confirm if it’s correct?
Regarding LM curve, there wouldn’t be any impact theoretically.
Now i’m trying to figure out how would this cause a shift in AD, i put the AD graph next to the ISLM equilibrum one but all i see is a possible movement along the AD curve but not a shift.
Can someone please help?
