When the economy is in a recessionary gap,Keynesian economists will often advocate expansionary policy measures.Why?
A) Keynesians believe the economy sometimes gets stuck in a recessionary gap and can't get itself out without government intervention.
B) Keynesians believe the economy itself sometimes takes too long to eliminate the recessionary gap and return to full-employment output.
C) Keynesians are generally in favor of increasing taxes.
D) a and b
E) a and c

Question

Quizplus · Accepted Answer

Keynesian economists believe that sometimes the economy gets stuck in a recessionary gap and can't get itself out without government intervention. They also believe that the economy itself sometimes takes too long to eliminate the recessionary gap and return to full-employment output. Therefore, they advocate expansionary policy measures to stimulate economic growth and employment. Increasing taxes is not a common policy advocated by Keynesians during a recessionary gap.

When the Economy Is in a Recessionary Gap,Keynesian Economists Will