Economics · IS-LM Model
Which of the following statements regarding the IS curve is INCORRECT?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The greater the multiplier and interest sensitivity of investment, the steeper the IS curve.✓
- 2The IS curve shifts due to changes in autonomous expenditure.
- 3The IS curve is negatively sloped.
- 4The IS curve shows combinations of interest rate and income where the goods market is in equilibrium.
Correct answer
The greater the multiplier and interest sensitivity of investment, the steeper the IS curve.
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