In this video, we solve a complete IS-LM-TR (Taylor Rule) model step by step, exactly as required in exams.
We cover:
1) Why the LM curve becomes redundant
2) Effects of money supply vs government spending
3) Short-run vs long-run equilibrium
4) Dynamic adjustment using price evolution (inflation equation)
Why output returns to potential but prices rise
This is ideal for students studying Intermediate / Advanced Macroeconomics, DSGE basics, and policy analysis.
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