Solved

What Did Keynes Argue About Aggregate Demand

Question 29

Multiple Choice

What did Keynes argue about aggregate demand?


A) Aggregate demand is stable because the economy returns to long-run equilibrium.
B) Aggregate demand is stable because changes in consumption are mostly offset by changes in investment and vice versa.
C) Aggregate demand is unstable and the government should actively stimulate aggregate demand when production is at less than its full employment level.
D) Aggregate demand is unstable and economies should be left to deal with short-run fluctuations on their own.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions