Chapter 28 Aggregate Supply Aggregate Demand and Inflation

Chapter 28 Aggregate Supply, Aggregate Demand, and Inflation: Putting It All Together

Figure 28. 1 The Aggregate Demand Curve

Figure 28. 2 The Effect of Expansionary Fiscal Policy or Increase Confidence on the AD Curve

Figure 28. 3 The Aggregate Supply Curve

Figure 28. 4 The Effect of an Increase in Inflationary Expectations on the Aggregate Supply Curve

Figure 28. 5 A Beneficial Supply Shock: Expansion of Output Capacity

Figure 28. 6 Aggregate Demand Supply Equilibrium in Recession

Figure 28. 7 Expansionary Fiscal Policy in Response to a Recession

Figure 28. 8 A Greater Expansion of Aggregate Demand

Figure 28. 9 Excessively High Aggregate Demand Causes Inflation

Figure 28. 10 The Phillips Curve in the 1960 s

Figure 28. 11 Rising Inflationary Expectations and Contractionary Fiscal Policy

Figure 28. 12 The Effect of the Oil Price Shock of the 1970 s

Figure 28. 13 The Effects of the Fed’s “Tight Money” Policy in the 1980 s

Figure 28. 14 Unemployment Trends 1960 -2017 (Percentage of Labor Force) Source: Bureau of Labor Statistics, Current Population Survey, 2018.

Figure 28. 15 Inflation Trends 1960 -2017 (Annual Percentage Inflation) Source: Bureau of Labor Statistics, Consumer Price Index (CPI-U), 2018.

Figure 28. 16 The Effects of Technological Innovation and Increased Efficiency

Figure 28. 17 The Classical View of AS/AD

Figure 28. 18 A New Classical View of Economic Fluctuations