According to Keynes,an unbalanced budget is appropriate in all of the following situations except when
A)The economy is below full employment.
B)Leakages and injections are out of balance.
C)Macro equilibrium is above full employment.
D)The economy is at full employment.

Question

Quizplus · Accepted Answer

Keynes believed that an unbalanced budget is appropriate in situations where there is unemployment and the economy is not at full employment. Therefore, when the economy is at full employment, an unbalanced budget would not be appropriate according to Keynesian theory.

According to Keynes,an Unbalanced Budget Is Appropriate in All of the Following