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Reconciling the Models

Reconciling the Models. Liquidity Preference Model of the Interest Rate. AD-AS Model. Loanable Funds Model of the Interest Rate. LRAS. SRAS 2. MS 1. MS 2. SRAS 1. S 1. Agg . Price Level (PL). Interest Rate (r). Interest Rate (r). PL 3. S 2. PL 2. r. r. PL 1. r 1. MD 2. r 1.

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Pl3 s2 pl2 r - PowerPoint PPT Presentation

Reconciling the Models