Untitled

import numpy as np
import matplotlib.pyplot as plt

# Define parameters
C = 300  # Autonomous consumption
c = 0.8  # Marginal propensity to consume
I_0 = 200  # Autonomous investment
G = 300  # Government spending
T = 100  # Taxes
M = 0  # Net exports

# Define the output range
Y = np.linspace(0, 1000, 1000)

# Calculate planned investment (I) and planned savings (S) at each level of output
I = I_0
S = C + c * (Y - T)

# Plot the IS curve
plt.plot(Y, I, label='Planned Investment (I)', color='blue')
plt.plot(Y, S, label='Planned Savings (S)', color='red')
plt.xlabel('Output (Y)')
plt.ylabel('Expenditure')
plt.title('IS Curve')
plt.legend()
plt.grid(True)
plt.show()