Which of the Following Is True

question 27

Multiple Choice

Which of the following is true?

• A)Keynes asked the question: If supply creates its own demand,why are we in a worldwide depression?
• B)According to Keynes,if savings were greater than investment,interest rates would fall,bringing the economy back to full employment.
• C)Keynes believed that wages and prices were flexible.
• D)Keynes believed the economy was basically stable.

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Definitions:

Chinese Yuan

The official currency of the People's Republic of China, used as a medium of exchange in mainland China.

Inflation

The rate at which the general level of prices for goods and services rises, eroding purchasing power.

Fixed Exchange-Rate System

A monetary system in which the value of a nation's currency is fixed to the value of a single currency, a group of currencies, or a tangible asset such as gold.

Foreign-Exchange Reserves

These are assets held by a central bank in foreign currencies, used to back its liabilities and influence monetary policy.