1. Explain the views of the Keynesians on rational expectation formulation and its implication on the effectiveness of stabilization policy. 2. Compare the new classical and monetarist positions...

1. Explain the views of the Keynesians on rational expectation formulation and its implication on the effectiveness of stabilization policy.

2. Compare the new classical and monetarist positions concerning the effectiveness of aggregate demand management policies to stabilize output.