According to Keynes, a. government spending should decrease during recessions. b. aggregate demand is most important to achieve potential output. c. aggregate supply is most important to achieve potential output. d. the government should not utilize fiscal policy to influence economic activity.

According to Keynes, a. government spending should decrease during recessions. b. aggregate demand is most important to achieve potential output. c. aggregate supply is most important to achieve potential output. d. the government should not utilize fiscal policy to influence economic activity.

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter11: Fiscal Policy: The Keynesian View And Historical Development Of Macroeconomics

Section: Chapter Questions

Problem 12CQ

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Question

According to Keynes,

	a.	government spending should decrease during recessions.
	b.	aggregate demand is most important to achieve potential output.
	c.	aggregate supply is most important to achieve potential output.
	d.	the government should not utilize fiscal policy to influence economic activity.

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