Chap033 The Warring Schools of Macroeconomics.ppt

Chapter 33
The Warring Schoolsof Macroeconomics
T-252Figure 33-1
According to Say’s Law, Supply Creates Its Own Demand as Prices Move to Balance Demand with Aggregate Supply
Aggregate Demand Helps Determine Output in the Keynesian Approach
T-253Figure 33-2
Velocity and ponents,1929-1995
T-254Figure 33-3
Source: V constructed by the authors from the data from the Federal Reserve Boardand the . Department merce.
Comparison of aristand Keynesian Views
T-255Figure 33-4
Rate of Changesof e Velocity of M1
T-256Figure 33-5
Source: Velocity defined as the ratio of GDP to M1; money supply from the Federal Reserve Boardand GDP from merce Department.
The New Classical Phillips Curve
T-256Figure 33-6
Comparison of Multipl