How Does the Original, Simplified Keynesian Model Compare with Modern

question 132

Multiple Choice

How does the original, simplified Keynesian model compare with modern Keynesian analysis?

• A) The original Keynesian model assumed price flexibility whereas the modern analysis does not.
• B) In both cases, the short-run aggregate supply curve (SRAS) is horizontal.
• C) Modern analysis shows an upward sloping SRAS to reflect some price flexibility. The original Keynesian model's SRAS is horizontal and assumes sticky prices.
• D) all of the above

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Definitions:

Attending to Others

The act of being present and fully engaged in listening and responding to the needs and concerns of others.

Clarifying Content

The process of making information, instructions, or content clearer and more comprehensible.

Arbitration

A form of dispute resolution where an impartial third party (the arbitrator) makes a binding decision to resolve a conflict between two or more parties.

Mediating

The process of intervening in a dispute with the aim to resolve it, often by helping the parties involved to find a mutual agreement.