2.2.7.2 - Keynesian Theory
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Practice Questions
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What is aggregate demand?
💡 Hint: Think about the consumption and investment in an economy.
What does the multiplier effect refer to?
💡 Hint: Consider what happens when money circulates in the economy.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does Keynes argue is essential for achieving full employment?
💡 Hint: Think about the actions taken during the Great Depression.
True or False: Keynesian theory suggests that markets self-correct to full employment automatically.
💡 Hint: Consider the contrast with Classical economics.
1 more question available
Challenge Problems
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Discuss the implications of a government stimulating the economy during a recession. Include potential short-term and long-term effects.
💡 Hint: Think about both immediate changes in employment and possible future issues.
Analyze the effectiveness of tax cuts as a tool to increase aggregate demand. What are potential advantages and disadvantages?
💡 Hint: Evaluate both responses on consumer behavior and fiscal sustainability.
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