1. The main assumption in the Keynesian model, and its importance and implications. 2. Unemployment during recessions and expansions. 3. The relationship between disposable income and consumption. 4. Components of PAE, and how output gaps emerge. 5. Fiscal policy tools to close recessionary/expansionary gaps in the Keynesian model (expansionary/contractionary fiscal policies by changing taxes and government purchases, and how much to change taxes by/spend: remember the role of the incomeexpenditure multiplier). 6. Monetary policy tools to affect nominal interest rates. 7. Equilibrium condition in the Keynesian model, and the relationship between PAE and r. 8. Okun's law. 9. How PAE and Y are affected by changes in r. 10. Stabilization policies