After studying this chapter, you should be able to understand:
- Economic growth refers to an increase in the amount of goods and services which are produced in an economy over time.
- The Harrod–Domar model is a long-run model, which is an extension of the Keynesian model of income and employment.
- The views of Robert Solow, Trevor Swan, James Tobin and many others have been put together as the neoclassical growth theory, which was developed in the 1950s.
- Business cycles relate to economic changes in the short run in production.
- A business cycle generally moves between periods of expansions and contractions with the peaks and the troughs forming the extremes.
- According to the ...