John Maynard Keynes Advocated Policies That Would Increase Aggregate Demand

question 102

True/False

John Maynard Keynes advocated policies that would increase aggregate demand as a way to decrease unemployment caused by recessions.

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Definitions:

Increasing Marginal Product

A situation where each additional unit of input results in an increased amount of output.

Economic Rents

Extra earnings above the minimum amount necessary to keep a factor of production in its current use.

Accounting Costs

The explicit costs of a business, representing the actual outflows of cash for wages, rent, materials, and other tangible inputs.

Economic Costs

The total cost of choosing one action over another, including both explicit (direct monetary costs) and implicit (opportunity costs) factors.