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31 August, 19:38

The IS-LM model's biggest drawback is that it doesn't consider changes in the investment leve1. True 2. False

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  1. 31 August, 20:04
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    The correct answer is number (2) : False.

    Explanation:

    The Investment-Savings (IS) Liquidity preference-money supply (LM) or IS-LM model describes the changes between economic goods (IS) related to investments (LM). Usually portrayed in a graphic, the approach aims to show how the IS an LM interact to balance the production of the overall economy.
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