Answered

Westonci.ca is the Q&A platform that connects you with experts who provide accurate and detailed answers. Join our Q&A platform and connect with professionals ready to provide precise answers to your questions in various areas. Get precise and detailed answers to your questions from a knowledgeable community of experts on our Q&A platform.

Which policy suggests Keynesian economic theory?

A. Proposing long-term solutions in order to create wider swings in the business cycle
B. Short-term increases in government spending to stimulate the economy
C. Reducing government involvement in the free-market economy
D. Creating a national banking system that owns and operates most of the global and regional banks

Sagot :

GinnyAnswer

Final answer:

Keynesian economic theory recommends using fiscal policies to address economic challenges such as recessions and inflation.


Explanation:

Keynesian economic theory suggests using expansionary fiscal policy during a recession, such as increasing government spending or implementing tax cuts to stimulate the economy by shifting the aggregate demand curve to the right. On the other hand, contractionary fiscal policy, like tax increases or government spending cuts, is recommended when the economy is operating above potential GDP to combat inflation.


Learn more about Keynesian economic theory here:

https://brainly.com/question/34785944


We appreciate your time on our site. Don't hesitate to return whenever you have more questions or need further clarification. We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Thank you for choosing Westonci.ca as your information source. We look forward to your next visit.