According to Keynes,the private sector (by itself)
A) can always move the economy out of a recessionary gap in a timely manner.
B) cannot always move the economy out of a recessionary gap in a timely manner.
C) can never move the economy out of a recessionary gap.
D) can only move the economy out of a recessionary gap if the SRAS curve drops.
E) can only move the economy out of a recessionary gap if the SRAS curve rises.

Question

Quizplus · Accepted Answer

According to Keynes, the private sector cannot always move the economy out of a recessionary gap in a timely manner, as they may not invest or spend enough due to uncertainty and lack of confidence during a recession. Therefore, government intervention through fiscal policy (such as increasing government spending or cutting taxes) is necessary to stimulate aggregate demand and move the economy out of a recessionary gap.

According to Keynes,the Private Sector (By Itself)