Which of the following policy statements would a Keynesian economist tend to support?

Question

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Keynesian economists tend to support government intervention in the economy to stimulate demand during times of economic downturns. This can include fiscal policies such as government spending or monetary policies such as adjusting interest rates or increasing the money supply. The goal is to increase aggregate demand and restore economic growth. Option A implies encouraging savings, which is not consistent with Keynesian theory. Option B suggests no government intervention, which is also not in line with Keynesian beliefs. Option D focuses on aggregate supply, rather than demand, which is not a primary concern for Keynesian economists. Option E places more emphasis on long-run supply-side policies, which is not the immediate priority for Keynesian economics during a recession.

Which of the Following Policy Statements Would a Keynesian Economist