by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What are the NeoClassical and Keynesian View of Long-Run Aggregate Supply and Demand? The aggregate demand and aggregate supply diagram shows two aggregate supply curves. We draw the original upward sloping aggregate supply curve (SRAS0) is a short-run or Keynesian AS...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What are Keynesian vs Neoclassical Macroeconomic Policy Recommendations? Let’s summarize what neoclassical economists recommend for macroeconomic policy. Neoclassical economists do not believe in “fine tuning” the economy. They believe that a stable economic...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is the Keynesian Perspective on Market Forces? Ever since the birth of Keynesian economics in the 1930s, controversy has simmered over the extent to which government should play an active role in managing the economy. In the aftermath of the human devastation and...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is the Keynesian Approach to Unemployment and Inflation? Keynesian macroeconomics argues that the solution to a recession is expansionary fiscal policy, such as tax cuts to stimulate consumption and investment, or direct increases in government spending that...
by TheBusinessProfessor | Feb 23, 2025 | Economic Analysis & Monetary Policy
What is the Expenditure Multiplier? A key concept in Keynesian economics is the expenditure multiplier. The expenditure multiplier is the idea that not only does spending affect the equilibrium level of GDP, but that spending is powerful. More precisely, it means that...
