In the 1970s, the U.S. economy saw sharp changes in real GDP and in the price level. This
Jpresented a challenge to policymakers and to economists because these outcomes could not be explained by a Keynesian analysis.

Question

Quizplus · Accepted Answer

The statement is true. The changes in real GDP and the price level in the 1970s were attributed to factors such as oil price shocks and supply-side disruptions, which were not adequately captured by traditional Keynesian analysis. This led to the development of new economic theories and policies, such as monetarism and supply-side economics.