Analysis using IS-LM model Article Example | Topics and Well Written Essays - 500 words

Analysis using IS-LM model - Article Example These are considered to be the vital ingredients of an economy; therefore, a change in each would lead to an effect in the economy, as either an economic turmoil or a positive encounter. According to the Globe and Mail, China has been on the frontline in making an economic improvement in each subsequent year. The country has been improving in its economy with each passing year, growing to be the second world’s biggest economy. This is a positive approach to the country’s economy, as it has stipulated methods of growth. Since 2009, the country has recorded its ever first lowest decline in economic growth. The country’s economic growth dropped from an average of 8.1% to a low of 7.6%. This was an occurrence that proved that the country’s economic growth would further deteriorate if not approached with the best economic measures. The economy had to encompass economic strategies that would revive its economic growth to a better position, just like the previous years. Therefore, the second biggest world’s economy would have to improve its approach towards economic growth to resuscitate the economic turmoil. The economic redundancy in the china republic could be explained by the IS-LM curve in a number of ways, which are closely related to the economy. First, the economic decline was forced due to the stagnant real estate investments. Many people had acquired investments in real estates, with a focus of making an increase in their investments. In many countries, real estate is considered a highly viable investment. Therefore, many people have been compelled o increase their investments in the sector, including the china economy. However, the supply for real estate escalated, while the demand remained the same. With such a prevalent situation in the market, there were little tradeoffs between the real estate owners and the buyers. This led to a reduction in the interest rates as most of the owners had to