Keynes expressed doubts that that the economy would
A) ever return to full-employment.
B) ever move away from full-employment.
C) recover from a major recession without active policy.
D) recover from the effects of higher prices.

Question

Quizplus · Accepted Answer

Keynes believed that the economy could experience prolonged periods of underemployment and that it required government intervention through active fiscal policy (such as increased government spending and tax cuts) to promote economic growth and decrease unemployment. He also argued that a laissez-faire approach to the economy would not be effective in promoting full-employment. Therefore, option C accurately reflects Keynes' views on the role of government in responding to economic downturns.

Keynes Expressed Doubts That That the Economy Would