Discuss how Classical Economists views and Keynesians’ views conflict each other regarding Say’s Law, flexibility of wages and prices, existence of self-regulation and the requirement of government intervention. Make sure you talk about what happens if there is a recessionary gap and an inflationary gap under both views.

Q: Keynesian View on the Government’s Role in the Economy: Explain how Keynes concluded that the…

A: The macroeconomic economic theory of total expenditure in the economy and its consequences on…

Q: Explain any two criticism of Keynesian theory

A: According to the given question a Keynesian theory is basically a theory which refers to the total…

Q: What might be some Keynesian prescriptions to get the economy out of an economic slump (both fiscal…

A: Under the Keynesian theory, the aggregate demand is given by the sum of consumption demand (C),…

Q: Think back to August 6, 1945. The United States has just dropped an atomic weapon on the city of…

A: It was during the 1939 gathering of dark war clouds over Europe that Keynes saw it as an opportunity…

Q: Which of the following would be a fiscal policy prescription for ending inflation? A) Raise taxes…

A: Inflation is the incident when the general price-level(P) of the economy rises over time. The…

Q: Suppose the economy is experiencing a recession with high unemployment. With a goal of increasing…

A: Recession  When there is a general fall in economic activity, there is a recession, which is a…

Q: Some of the practical problems relating to implementing expansionary Keynesian policy relate to…

A: Lag is just another way of saying "delay"; fiscal policy is associated with data lags, recognition…

Q: If the government tries to reduce inflation when the production level in the country is higher than…

A: Fiscal policy is a tool used bu government to bring the economy back to full employment.

Q: What stimulates a rise of employment according to Keynes? An increase of supply A decline of minimum…

A: Answer: In Keynesian theory a rise in employment results due to a rise in effective demand.

Q: When the economy is in an inflationary gap, using relevant diagrams show whether the economy should…

A: There are different views regarding economic principles. Keynesian school of thought and the…

Q: Explain the theory of the classical economists that flexible prices and wages ensure that the…

A: Classical model was based on several assumptions. The major result was that : “Given flex­ible wages…

Q: According to Keynes, what are the major sources of economic instability? Fiscal policy is spending…

A: According to Keynes, the major cause of economic instability is insufficient AD i.e. aggregate…

Q: ich of the following statements are FALSE? (a) When the government prints money to buy…

A: Government spending is effective during the recessionary pressures. The recessionary pressures lead…

Q: We call the model of income determination  a Keynesian . What makes it Keynesian, as opposed to…

A: In economics, there are two popular school of thoughts: classical and Keynesian. The classical…

Q: According to the Keynesian economists, who reject the self-regulating economy, how does the economy…

A: Before the Keynesian economics came into existence, there was a classical believe that economy is…

Q: From a Keynesian point of view, which is more likely to cause a recession: aggregate demand or…

A: Keynesian talked about Aggregate demand, he emphasized more on government intervention to correct…

Q: Suppose in the country of Miltonia, Ricardian equivalence is 100% true. A- If Miltonian tax rates…

A: One of the most commonly used theories of Professor David Ricardo is the concept of comparative…

Q: 0.    Increasing the debt ceiling a.    is tied to the increase in the CPI. b.    must be approved…

A: Debt ceiling-It is compulsory as per constitution to set upper limit on the total outstanding public…

Q: Keynes broke with the classical and neo-classical economic perspective in regards to the belief of…

A: In particular, Keynes criticised Say's Law for its appeal that 'supply' produces its own demand and…

Q: Suppose that the public’s taste changes in such a way that leisure comes to be more desirable than…

A: Taste: When desire, emotions, or preference of consumers change in favor of a product due to which…

Q: According to Keynes(Keynesian Macroeconomics), can the private sector always remove the economy from…

A: Keynesian school of economic thought contradicts the classical economic thought that economy always…

Q: Keynesian economists argue that facing an economic recession. and are the surest way to ensure full…

A: The economies around the world tend to depend upon the working of the government, and also the…

Q: According to Keynesian economics, what impact would a balanced budget amendment to the constitution…

A: A balanced budget amendment is a constitutional requirement that a state's spending cannot exceed…

Q: Comparison between the classical and Keynesian theory

A: The classical theory of economics was an replacement of the mercantilist theory.  The classical…

Q: Why Keynesian economics become popular back in 1930’s. Do you think that during 2005-08 financial…

A: Keynesian economics was a focus made by J.M Keynes to understand the great depression of 1930. His…

Q: What effect do you think this federal government shutdown may have had on the Keynesian C + I + G +…

A: Government shutdown is defined as the termination of unnecessary government administration and…

Q: Explain how Classical and Keynesian economists view the use of active government to maintain full…

A: In economics, two major approaches to analyze an economy is classical economics and Keynesian…

Q: How would a Keynesian Economist use Fiscal Policy to fight a Recession? Please do not write about…

A: "Recession means reduction or fall in the economic activity and this fall is visible in real GDP,…

Q: Which of the following is a belief of classical theory? A. Long-run full employment B. Inflexible…

A: Macroeconomics is a part of economics that explains economic behavior as a whole. It discusses the…

Q: Contrast the appropriate Keynesian response to an economy experiencing recession with the…

A: Meaning of Inflation: Inflation generally arises when there is an excessive increase in the level…

Q: According to Keynes O fiscal policy is counterproductive because the economy is always at full…

A: Monetary policy is a macroeconomic tool that is used by the central bank to control the supply of…

Q: According to the classical economists, the supply curve is vertical at the level of potential GDP.…

A: In the aggregate demand (AD) and the aggregate supply (AS) model, the supply curve is vertical at…

Q: Use the Keynesian cross diagram to analyze the effects of the following on real output. (a)…

A: Disclaimer :- As you posted multipart questions we are supposed to solve only the first 3 questions.…

Q: Which do you believe is the better macroeconomic policy to use for stabilizing (achieving potential…

A: A MP is a policy implemented by the Central Bank(CB) or the government of the company to control the…

Q: Which one of the following statements is false? Keynes thought that the interest rate was the most…

A: Investment plans, according to Keynes, are determined by evaluating the marginal efficiency of…

Q: A number of countries, like Greece and the United Kingdom, have in the past few years responded to…

A: The government when undertakes an austerity policy by cutting its own expenditure and also…

Q: Keynes believes that when the economy is in liquidity trap, fiscal policy is ineffective. True or…

A: When the economy is in liquidity trap, Monetary policy is ineffective. Fiscal policy is effective…

Q: Explain the difference between Keynesian economics and Classical economics by mentioning the…

A: Note: Since you have posted multiple independent questions in the same request, we will solve the…