Stability Analysis of Cycle Business Investment Saving-Liquidity Money (IS-LM) Model using Runge-Kutta Fifth Order and Extended Runge-Kutta Method

Ulia Maulidah Musyaffafi, Mohammad Hafiyusholeh, Yuniar Farida, Aris Fanani, Ahmad Zaenal Arifin

2018

Abstract

Forecasting the future conditions of economic stability can be illustrated in business cycle model. The IS-LM business cycle model is a business cycle model which is represented in a differential equation involving investment function (I), saving function (S), and money demand function (L). In this research, stability analysis on the IS-LM business cycle model was performed. Stability analysis was performed by Routh-Hourwitz criteria. After that, numerical simulation would be performed by comparing the Runge-Kutta method of fifth order and Extended Runge-Kutta to determine the stability speed of the model. This research resulted fixed point IS-LM model that is E=〖(Y〗^*,R^*,K^*)=(0.0979,0.0097,0.0351). Through data simulations, it was obtained numerical solution with the Extended Runge-Kutta method that has faster stable result, with t=25, compared with the Runge-Kutta Fifth Order method that is stable when t=36.

Paper Citation

in Harvard Style

Musyaffafi U., Hafiyusholeh M., Farida Y., Fanani A. and Arifin A. (2018). Stability Analysis of Cycle Business Investment Saving-Liquidity Money (IS-LM) Model using Runge-Kutta Fifth Order and Extended Runge-Kutta Method. In Proceedings of the Built Environment, Science and Technology International Conference - Volume 1: BEST ICON, ISBN 978-989-758-414-5, pages 240-246. DOI: 10.5220/0008905400002481

in Bibtex Style

@conference{best icon18,
author={Ulia Maulidah Musyaffafi and Mohammad Hafiyusholeh and Yuniar Farida and Aris Fanani and Ahmad Zaenal Arifin},
title={Stability Analysis of Cycle Business Investment Saving-Liquidity Money (IS-LM) Model using Runge-Kutta Fifth Order and Extended Runge-Kutta Method},
booktitle={Proceedings of the Built Environment, Science and Technology International Conference - Volume 1: BEST ICON,},
year={2018},
pages={240-246},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0008905400002481},
isbn={978-989-758-414-5},
}

in EndNote Style

TY - CONF

JO - Proceedings of the Built Environment, Science and Technology International Conference - Volume 1: BEST ICON,
TI - Stability Analysis of Cycle Business Investment Saving-Liquidity Money (IS-LM) Model using Runge-Kutta Fifth Order and Extended Runge-Kutta Method
SN - 978-989-758-414-5
AU - Musyaffafi U.
AU - Hafiyusholeh M.
AU - Farida Y.
AU - Fanani A.
AU - Arifin A.
PY - 2018
SP - 240
EP - 246
DO - 10.5220/0008905400002481