Keynesian Economists Argue That During a Recession

question 38

Multiple Choice

Keynesian economists argue that during a recession

• A) private sector spending will  rise  and therefore government spending should be reduced in order to help maintain aggregate demand at or near the full employment level.
• B) private sector spending will  decline, and therefore government spending should increase in order to help maintain a high level  of aggregate demand.
• C) private sector spending will  decline, and therefore government spending should be reduced in order to avoid the crowding out of  still more private  sector spending.
• D) private sector spending will  rise  and therefore government spending should be increased in order to provide more stimulus for the economy.

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