1.

In the general theory, Keynes' identified a role for government in compensating for the "animal sprits"nthat drove investment in general, and reductions of the investment in particular. Identify the three autonomous components of the IS curve that are involved with Keynes' view of "animal spirits." Include a brif explanation of why you chose each of these.

2.

Given Phillips' original expression for the Phillips curve, what level of unemployment corresponds to a wage inflation rate of zero?