The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 5

How long is the long run? Keynes accused his predecessors of ignoring the problem of recessions by assuming that they would correct themselves "in the long run." In a book written some years before The General Theory , he observed caustically that in the long run we are all dead.
(a) Suppose you think there is a 0.25 probability that by trying to remedy a recession the government will in fact make it worse, but that it will cure itself "in the long run." How long would you want to wait before accepting the risk of making matters worse?
(b) How long must a recession continue, or a recovery be delayed before we're justified in assuming that recessions are not merely "temporary disturbances?"