Which of the following statements is true about Keynes' macroeconomic theory? O Keynes argued that the economy would achieve full employment in the long run because of wage and price flexibility. Keynes stressed the notion that the economy would achieve price stability in the long run only if expansionary fiscal and monetary policies were used to address recessions. O Keynes dismissed the notion that the economy would achieve full employment in the long run as irrelevant in explaining prolonged recessions. O Keynes agreed that the notion that the economy would achieve the potential level of output in the long run is crucial to explaining prolonged recessions.

Which of the following statements is true about Keynes' macroeconomic theory? O Keynes argued that the economy would achieve full employment in the long run because of wage and price flexibility. Keynes stressed the notion that the economy would achieve price stability in the long run only if expansionary fiscal and monetary policies were used to address recessions. O Keynes dismissed the notion that the economy would achieve full employment in the long run as irrelevant in explaining prolonged recessions. O Keynes agreed that the notion that the economy would achieve the potential level of output in the long run is crucial to explaining prolonged recessions.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Easy beginner econ question. Thank you!

Which of the following statements is true about Keynes' macroeconomic theory?
Keynes argued that the economy would achieve full employment in the long run because of wage and
price flexibility.
O Keynes stressed the notion that the economy would achieve price stability in the long run only if
expansionary fiscal and monetary policies were used to address recessions.
O Keynes dismissed the notion that the economy would achieve full employment in the long run as
irrelevant in explaining prolonged recessions.
O Keynes agreed that the notion that the economy would achieve the potential level of output in the long
run is crucial to explaining prolonged recessions.

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