Chapter 25

The Complete Keynesian Model of Aggregate Demand

This chapter extends the Keynesian model to include the interest rate as a link between the quantity of money and investment. In this way, we integrate the monetary system into the Keynesian approach, gain more understanding of influences on investment spending, and provide a basis for the "Pigou Curve" or "Aggregate Demand Curve."

Begin the chapter

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Contents

  1. Toward a More Complete Model of Aggregate Demand
  2. An Alternative to Fiscal Policy
  3. Interest
  4. Determinants of Interest
  5. Real Money Balances
  6. Aggregate Demand
  7. Monetary Policy
  8. Reflections on the Complete Keynesian Model
  9. Chapter Summary
Next Chapter: Aggregate Supply

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