A Policy Implication of Keynesian Economics Is That

question 25

Multiple Choice

A policy implication of Keynesian economics is that

• A) full employment will always be maintained.
• B) countercyclical policies have no effect on the economy.
• C) constant growth of the money supply is better than discretionary policies.
• D) countercyclical monetary and fiscal policies can be used to achieve full employment.

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Definitions:

Cash Inflows

The total amount of money being transferred into a company, typically from operations, financing, or investing activities.

Net Cash Inflows

The total amount of cash received by a company during a specific period, minus the total amount of cash outflows.

Payback Period

The length of time required to recover the cost of an investment, calculated by dividing the initial investment by the annual cash inflow.

Discount Rate

The interest rate used to discount future cash flows to their present value, reflecting the time value of money and risk.