One explanation for rigid (sticky) prices according to Keynes is Group of answer choices inflation. flexible wages. government intervention. long-term labor contracts.
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One explanation for rigid (sticky) prices according to Keynes is
Group of answer choices
inflation.
flexible wages.
government intervention.
long-term labor contracts.
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- Compare and contrast the ideas of Keynes and the policies based on his ideas with the ideas and policies of the supply-side economists who came to prominence with the election of Ronald Reagan in 1980.Keynes recommended that high unemployment should be remedied with a reduction in the money supply an increase in government expenditures an increase in taxes an increase in aggregate supplyIn the Keynesian model, an increase in government spending increases ___. A.aggregate demand by an equal amount. B.aggregate demand by a multiple amount. C.the money supply by a multiple amount. D.the money supply by an equal amount.
- In the Keynesian framework, which of the following events might cause a recession? Which might causeinflation? Sketch AD/AS diagrams to illustrate your answers.a. A large increase in the price of the homes people own.b. Rapid growth in the economy of a major trading partner.c. The development of a major new technology offers profitable opportunities for business.d. The interest rate rises.e. The good imported from a major trading partner become much less expensive.What was the most “nicompoopish” belief that Keynes ridiculed?In the Keynesian framework, for each of the following events which might cause a recession and/or inflation? Explain using Aggregate Demand/ Aggregate Supply. a. A large increase in the price of the homes that people own b. Rapid growth in the economy of a major trading partner c. The development of a major new technology offers profitable opportunities for business d. The interest rate rises e. The good imported from a major trading partner becomes much less expensive. 
- To fight recession, a Keynesian economist would: (Select all that apply) A. Increase Taxes B. Decrease Taxes C. Increase Government Spending D. Decrease Government Spendingdid keynes believe that wages/prices were sticky in general-up and down? or just down?The Keynesian economic framework is based on an assumption that: A) an increase in government spending will cause the aggregate demand curve to shift to the left. B) people can afford a high level of government services. C) prices and wages are sticky and do not adjust rapidly. D) an increase in government spending will cause the aggregate demand curve to shift to the left.
- To fight inflation, a Keynesian economist would: (Select all that apply): A. Increase Taxes B. Decrease Taxes C. Increase Government Spending D. Decrease Government SpendingWhy might a Keynesian Economist argue that a Federal Reserve policy alone will not get us out of a recession? ( explain in full response)Suppose the economy is experiencing a recession with high unemployment. With a goal of increasing GDP back to the full employment level:1. what would a liberal economist suggest policy makers do as the correct course of action? (think of those that may align their thinking to that of Keynes)2. what would a conservative economist suggest policy makers do as the correct course of action? (think of those that may align their thinking to that of Say)