Analysis on Flow and Stock Variables in the Economic System -- Basic Concepts of Aggregate Supply and Aggregate Demand -- Formation Processes of the Aggregate Demand and Aggregate Supply Function -- The Formation Processes of the Aggregate Supply and Aggregate Supply Function.

This book reflects China's experience, model and theory of successful inflation control. The idea of Stabilization of Expectations emphasized by the Chinese government was primarily proposed in this book with systematic theoretical support. The theory framework initiated in this book has been about 10 years earlier than that of the European and American economists. The core theory of this work is Sticky Expectation Theory, which breaks through the framework of neoclassical economic theory, denies the fundamental preconditions of neoclassical economic theory to establish a new theoretical framework so as to understand people's economic behavior and explain the operating mechanism of economy. This book establishes the Chinese version of flexible inflation targeting system, policy transparency, policy rules, and expectation management as the means to prevent and manage inflation and macro-control. Readers will gain a better understanding of the research achievements of Chinese scholars in the field of inflation management as well as the theory of expectations. Readers can further understand the Chinese approach in tackling inflation issue and other macro-economic control measures proposed by this book.