1. Copyright © 2002 Pearson Education, Inc. Slide 1

2. Copyright © 2002 Pearson Education, Inc. Slide 2 Keynesian Business Cycle Theory: The Sticky Wage Model Chapter 10

3. Copyright © 2002 Pearson Education, Inc. Slide 3 Figure 10-1 The Labor Market in the Keynesian Sticky Wage Model

4. Copyright © 2002 Pearson Education, Inc. Slide 4 Figure 10-2 The Labor Market in the Keynesian Sticky Wage Model When There Is Excess Demand

5. Copyright © 2002 Pearson Education, Inc. Slide 5 Figure 10-3 Construction of the Aggregate Supply Curve

6. Copyright © 2002 Pearson Education, Inc. Slide 6 Figure 10-4 The Effect of an Increase in W or a Decrease in z

7. Copyright © 2002 Pearson Education, Inc. Slide 7 Figure 10-5 The IS Curve

8. Copyright © 2002 Pearson Education, Inc. Slide 8 Figure 10-6 Money Demand, Money Supply, and the LM Curve

9. Copyright © 2002 Pearson Education, Inc. Slide 9 Figure 10-7 Determination of r and Y Given P

10. Copyright © 2002 Pearson Education, Inc. Slide 10 Figure 10-8 The Effect of an Increase in the Money Supply on the LM Curve

11. Copyright © 2002 Pearson Education, Inc. Slide 11 Figure 10-9 The Effects of an Increase in the Price Level on the LM Curve

12. Copyright © 2002 Pearson Education, Inc. Slide 12 Figure 10-10 A Positive Shift in Money Demand Shifts the LM Curve to the Left

13. Copyright © 2002 Pearson Education, Inc. Slide 13 Figure 10-11 The Aggregate Demand Curve

14. Copyright © 2002 Pearson Education, Inc. Slide 14 Figure 10-12 A Shift to the Right in the IS Curve Shifts the AD Curve to the Right

15. Copyright © 2002 Pearson Education, Inc. Slide 15 Figure 10-13 A Shift to the Right in the LM Curve Shifts the AD Curve to the Right

16. Copyright © 2002 Pearson Education, Inc. Slide 16 Figure 10-14 The Keynesian Sticky Wage Model

17. Copyright © 2002 Pearson Education, Inc. Slide 17 Figure 10-15 An Increase in the Money Supply in the Sticky Wage Model

18. Copyright © 2002 Pearson Education, Inc. Slide 18 Table 10-1

19. Copyright © 2002 Pearson Education, Inc. Slide 19 Figure 10-16 An Increase in the Demand for Investment Goods in the Sticky Wage Model

20. Copyright © 2002 Pearson Education, Inc. Slide 20 Table 10-2

21. Copyright © 2002 Pearson Education, Inc. Slide 21 Figure 10-17 Money Supply and GDP

22. Copyright © 2002 Pearson Education, Inc. Slide 22 Figure 10-18 Real and Nominal Interest Rates

23. Copyright © 2002 Pearson Education, Inc. Slide 23 Figure 10-19 Long-Run Adjustment of the Nominal Wage

24. Copyright © 2002 Pearson Education, Inc. Slide 24 Figure 10-20 Stabilization Policy in the Sticky Wage ModelMonetary Policy

25. Copyright © 2002 Pearson Education, Inc. Slide 25 Figure 10-21 Stabilization Policy in the Sticky Wage ModelFiscal Policy

26. Copyright © 2002 Pearson Education, Inc. Slide 26 Figure 10-22 The Equilibrium Effects of a Positive Money Demand Shift