Aggregate Demand in Keynesian Analysis

Critical Thinking Questions

In its recent report, The Conference Board’s Global Economic Outlook 2015, updated November 2014 (http://www.conference-board.org/data/globaloutlook.cfm), projects China’s growth between 2015 and 2019 to be about 5.5%. International Business Times (http://www.ibtimes.com/us-exports-china-have-grown-294-over-past-decade-1338693) reports that China is the United States’ third largest export market, with exports to China growing 294% over the last ten years. Explain what impact China has on the U.S. economy.

What may happen if growth in China continues or contracts?