The Keynesian View Implies That There Is a Role for Monetary

question 4

Multiple Choice

The Keynesian view implies that there is a role for monetary and fiscal policy in stabilizing the economy in response to aggregate shocks because

• A) prices and wages are slow to clear markets.
• B) money is neutral.
• C) comovement of aggregate variables does not generally happen during the business cycle.
• D) business cycles have many causes.
• E) these policies are highly effective in raising total factor productivity.

---

Definitions:

Cycadophyta

A division of gymnosperms that includes cycads, characterized by large compound leaves and a stout trunk.

Pteridophyta

A division of non-flowering plants that includes ferns, horsetails, and whisk ferns, characterized by vascular tissue and the absence of seeds.

Gnetophyta

A division of gymnosperms comprising woody plants with some angiosperm-like features, including the genera Ephedra, Gnetum, and Welwitschia.

Gametophyte

The haploid phase in the life cycle of plants and algae that produces gametes for sexual reproduction.