Unlike the Classical economists, Keynes believed that money could affect real economic activity through its effects on
A) the price level.
B) the interest rate.
C) savings.
D) velocity.

Question

Quizplus · Accepted Answer

Keynes believed that changes in the supply and demand for money can affect the interest rate, which in turn can impact real economic activity such as investment, consumption, and production. This is known as the liquidity preference theory.

Unlike the Classical Economists, Keynes Believed That Money Could Affect