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(Based on substitution of the equilibrium interest rate in either the IS or LM equation)

20. Yg = 15,000.00 + ######## (0.04)

= 15,000.00 + 1,507.54

21. Yg = 16,507.54

IS = 16,714.29 -5,714.29 i

LM = 15,000.00 ####### i

i = 3.6181%

0%

5%

10%

15%

20%

25%

30%

$15,106 $15,424 $15,742 $16,059 $16,377 $16,695

IS-LM Equilibrium

LM IS

3.6181%

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