Exhibit: IS-LM Fiscal Policy Intere (Exhibit: IS-LM Fiscal Policy) Based on the graph, starting from equilibrium at interest rate $r_{1}$ and income $Y_{1}$ , an increase in government spending would generate the new equilibrium combination of interest rate and income: $r_{2}, Y_{2}$ $r_{3}, Y_{2}$ $r_{2}, Y_{3}$ $r_{3}, Y_{3}$

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Exhibit: IS-LM Fiscal Policy Intere (Exhibit: IS-LM Fiscal Policy) Based on the graph, starting from equilibrium at interest rate

r_{1}

and income

Y_{1}

, an increase in government spending would generate the new equilibrium combination of interest rate and income:

r_{2}, Y_{2}

r_{3}, Y_{2}

r_{2}, Y_{3}

r_{3}, Y_{3}

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