According to John Maynard Keynes' General Theory of Employment,Interest and Money,the government should _____ in order to get an economy out of a depression.
A)increase spending
B)decrease spending
C)reduce subsidies
D)increase taxes
E)allow the economy to correct itself

Question

Quizplus · Accepted Answer

According to Keynesian theory, during a recession or depression, aggregate demand falls, leading to lower employment and output. To counteract this, the government must increase its own spending to stimulate aggregate demand, thereby promoting employment and economic growth. This is known as fiscal stimulus.