10. Shifts of the LM curve

Interacting with graphs to learn more about shifting the LM curve

The LM curve represents the combinations of income and the interest rate that lead to equilibrium in the money market. As with any graph drawn by economists, many variables have been held constant including the money supply. But, we know the Federal Reserve changes the money supply as part of monetary policy. Let's see how changes in monetary policy affect the position of the LM curve.

Objectives

Click on the 'Exploration' link above to continue.