Which of the Following Statements Is True About Keynes' Macroeconomic

question 19

Multiple Choice

Which of the following statements is true about Keynes' macroeconomic theory?

• A) 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.
• B) Keynes dismissed the notion that the economy would achieve full employment in the long run as irrelevant in explaining prolonged recessions.
• C) 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.
• D) Keynes argued that the economy would achieve full employment in the long run because of wage and price flexibility.

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Definitions:

Binomial Distribution

A probability distribution that summarizes the likelihood of a variable to take one of two independent values under a given number of iterations.

Distribution of X

Refers to the way values of the variable X are spread or distributed across possible outcomes, showing the frequency of each value.

Speed Limits

Legal maximum or minimum speeds set for vehicles on particular roads to ensure safety.

Binomial Experiment

A statistical experiment that has exactly two mutually exclusive outcomes, often labeled as success and failure.