What's Holding Demand Together?
Total demand = Consumption + Investment + Government Spending + Net Exports (C + I + G + NX)
The IS curve focuses especially on interest-sensitive components like investment and sometimes consumption.
The idea: output adjusts to match demand — that’s equilibrium.
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Economics and politics student from Germany. Interested in a broad field of topics and trying to easily break down topics from his studies to everyone.
In this post, I want to give you a first introduction into the goods market, presented through the IS-Curve. In future posts, I will conclude this rather simple and abstract model into the bigger picture. I hope this may help to understand economics a bit better in an easy way.
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