Keynes believed that prices and wages were rigid or fixed until the economy reachesequilibriumfull employmentrecessionexpansionWhich of the following did John Maynard Keynes believe held the key to understanding fluctuations in investment?how people spend their moneyhow businesses make predictionshow inflation affects the economyhow governments enact policyWhich of the following best characterizes the relationship between real GDP and aggregate expenditures under theaggregate expenditure model?unimportantinversedependentuncertainOutput decreases when aggregate expendituresincreasedecreasestagnatedestabilizeIn the early 1980s, the government used fiscal policy to fight a recession byincreasing tax rateslowering tax rateslimiting government spendingsuspending unemployment benefits.

"Keynesian economics" is a type economic theory that is established by the British economist John…

Answered: Keynes believed that prices and wages…

Keynes believed that prices and wages were rigid or fixed until the economy reaches equilibrium full employment recession expansion

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

Keynes believed that prices and wages were rigid or fixed until the economy reaches
equilibrium
full employment
recession
expansion
Which of the following did John Maynard Keynes believe held the key to understanding fluctuations in investment?
how people spend their money
how businesses make predictions
how inflation affects the economy
how governments enact policy
Which of the following best characterizes the relationship between real GDP and aggregate expenditures under the
aggregate expenditure model?
unimportant
inverse
dependent
uncertain
Output decreases when aggregate expenditures
increase
decrease
stagnate
destabilize
In the early 1980s, the government used fiscal policy to fight a recession by
increasing tax rates
lowering tax rates
limiting government spending
suspending unemployment benefits.

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