The "Naïve" Keynesian Model Is Unrealistic Because It

question 82

Multiple Choice

The "naïve" Keynesian model is unrealistic because it

• A)Does not take into account probable changes in the price level as the economy approaches full employment.
• B)Assumes that the price level decreases as AD increases.
• C)Assumes that AS is upward sloping when it is more probably horizontal.
• D)Does not account for changes in output due to the multiplier.

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Definitions:

Stamp Act

A law passed by the British Parliament in 1765 requiring all legal and commercial documents in the American colonies to bear an official tax stamp, leading to widespread protests and contributing to the American Revolutionary movement.

Differential-compound

Refers to a type of compound wound DC generator or motor that combines both series and shunt windings to achieve specific electrical characteristics.

Cumulative-compound

Refers to a type of DC generator where both series and shunt field windings add their magnetic fluxes to produce the total output voltage.

Shunt Field

A coil wound with small wire and having many turns designed to be connected in parallel with the armature of a DC machine.