Objectives: To understand:
- Aggregate Demand in Keynesian Analysis
- The Phillips Curve
- The Keynesian Perspective on Market Forces
- The Basics of Neoclassical Analysis
- Policy Implications of the Neoclassical Perspective
To-Do Before Class
Read Ch. 12 Introduction to the Keynesian Perspective
Ch. 13 Introduction to the Neoclassical Perspective
Activities/Assignments
- Apply Your Knowledge
Review: Ch. 12 Key Concepts & Summary and Ch. 13 Key Concepts & Summary
Answer: Ch. 12 Critical Thinking Question #23; Ch. 13 Review Question #9; Ch. 13 Problem #21
Economics in the Real World
Example 1:
Biden Administration Will Begin Disbursing $350 Billion in State and Local Aid
Discussion
Part of the coronavirus stimulus bill signed into law in March 2021 will include aid to state and local governments that experienced extensive losses in tax revenue during the pandemic. Does this policy reflect an example of Neoclassical or Keynesian economic policy?
Provide a clearly detailed explanation for your answer.
Example 2:
During Covid-19, Most Americans Got Richer—Especially the Rich
Discussion
In what ways was the pandemic-related economic downturn not typical of most recessions? What trends were different?
