Modern Keynesians differ from traditional Keynesians because modern Keynesians
A)Believe that monetary policy can be useful in managing the economy.
B)Favor fixed rules and steady,predictable policies.
C)Believe that failures of the economy are inherent in a capitalist economy.

Question

Quizplus · Accepted Answer

Modern Keynesians believe that both monetary and fiscal policy can be useful in managing the economy, while traditional Keynesians only believed in fiscal policy. Modern Keynesians also focus more on long-term growth instead of just short-term stabilization, and favor more flexible policy responses rather than a fixed set of rules. They do not believe that failures of the economy are inherent in a capitalist economy, but rather that government intervention can help address market failures and promote overall well-being.

Modern Keynesians Differ from Traditional Keynesians Because Modern Keynesians