##  [IS-LM Model](/index.php/lm-model) 

  ##  [IS-LM Model](https://social.quantumdictionary.io/lm-model-0) 

  

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**Social Sciences Dictionary**

 







 

 

 

 



 

 

 

 

Definition

A short-run macroeconomic framework that determines the simultaneous equilibrium level of real output (Y) and the interest rate (r) by intersecting two reduced-form loci: the IS curve (goods market equilibrium: planned investment equals saving) and the LM curve (money market equilibrium: liquidity preference equals money supply), typically under the assumptions of a fixed price level, a closed eco