Graph 14 - Laffer Curve

Graph 13 - Phillips Curve

Graph 12 - Crowding Out

Graph 11- Loanable Funds or Bond Market

Graph 10 - Money Market

Graph 9 - Investment Demand

i - Interest = cost of doing.

Reasons to borrow money:

_ Business

_ Mortgage

_ Education 

Graph 8 - Consumption and Savings Link

C_{2 - consumption increase at every level of DI.}

_{The poor and rich are spending more.}

DI = Consumption + Saving

If C increase, then S decrease.

MPC + MPS = 1

Graph 7 - Savings Function

Graph 6 - Consumption Function

Graph 5 - Modern Aggregate Model

Graph 4 - Common Aggregate Model

Graph 3 - Traditional Aggregate Model

Graph 2 - Business Cycle

E - Expansion
P - Peak
C/R - Contraction/Recession
T- Trough

Notes

• One cycle is from trough to trough.
• The average cycle is 6 years.
• Recession lasts about 14 months.
• The bulk of a cycle is the growth stage.
• Peaks and Trough are meaningless because we never know we are in one until it's over.
• If a recession loses more than 10% of real GDP, then it is a depression.
• Trough means the end of a recession.

Graph 1 - Production Possibility Graph