Which of the following policy statements would a Keynesian economist tend to support?
A) The government should encourage savings as a means of promoting economic growth.
B) The government should never intervene in the economy.
C) The government should intervene in the economy to promote employment.
D) The government should intervene in the economy only when total output changes.
E) The government should focus on long-run supply, not demand.

Question

Quizplus · Accepted Answer

Keynesian economists believe that the government should intervene in the economy to promote employment and economic growth during times of recession or depression. This can be achieved through policies such as fiscal stimulus, increasing government spending, and reducing taxes. Encouraging savings (A) and focusing on long-run supply (E) are not priorities for a Keynesian economist. The statement in option B contradicts the Keynesian approach altogether. The statement in option D is too vague as it does not specify what kind of output changes would require government intervention.

Which of the Following Policy Statements Would a Keynesian Economist