Brief History of Macroeconomic Thought and Policy
Read this chapter to examine macroeconomic attitudes towards economic policies of the three main schools of economic thought: Classical, Keynesian, and Monetarist. Also, learn about modern day interpretations of the main ideas.
3. Macroeconomics for the 21st Century
Show the effect of an expansionary monetary policy on real GDP
- according to new Keynesian economics
- according to the rational expectations hypothesis
In both cases, consider both the short-run and the long-run effects.