How Do Keynesian Economic Policies Differ from the Traditional Laissez-Faire

question 61

Multiple Choice

How do Keynesian economic policies differ from the traditional laissez-faire policies developed by Adam Smith?

• A)Laissez-faire advocates for "cutthroat" capitalism, while Keynesian policies seek to spread wealth equally among a nation's citizens.
• B)Keynesian economics advocate for increased government control of economics, while traditional laissez-faire argues for a hands-free approach.
• C)Smithian policies advocate for increased spending and stimuli for government-run businesses, while Keynesian economics argues for a hands-free approach.
• D)The more liberal Smithian economies distribute wealth more evenly among society, while Keynesian economics tends to distribute wealth among the top one percent.

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Definitions:

Total Debt Service Ratio

A debt measure that financial institutions use to evaluate a borrower's ability to manage monthly payments and repay debts.

Gross Monthly Income

The total personal income earned per month before any deductions like taxes or social security contributions.

Compounded Semi-annually

Interest calculation method where interest is computed on the principal and also on the interest from previous six-month periods, applied twice a year.

Amortized

The process of paying off a debt over time in regular installments of interest and principal sufficient to repay the loan in full by its maturity date.