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, because waves of pessimism and optimism create fluctuations in aggregate demand.
D) Aggregate demand is unstable, because seasonal variations create fluctuations in aggregate demand.
Correct Answer:
Verified
Correct Answer:
Verified
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