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(1) Although economists generally agree about the importance of expectations, there are different explanations of the way in which expectations are formed and how to include them in economic analysis. Compare and contrast the way in which Keynes, Friedman and Lucas treated expectations and how they included them in their theories of output and employment. (100) Prescribed reading Snowdon and Vane 2005: Chapter 2, 36 -70 (especially section 2.8, pages 58 - 65) Chapter 4, 163 - 187 (especially section 4.3, pages 174 - 187) Chapter 5, 219 - 271 (especially section 5.3.1, pages 225 - 230 and section 5.4, pages 236 - 242)