What did Keynes believe caused recessions and depressions?
A) excess aggregate demand
B) inadequate aggregate demand
C) excess aggregate supply
D) inadequate aggregate supply

Question

Quizplus · Accepted Answer

Keynes believed that inadequate aggregate demand, or a lack of spending by consumers, businesses, and governments, was the primary cause of recessions and depressions. He argued that government intervention through fiscal policy, such as increased government spending and tax cuts, was necessary to stimulate demand and pull the economy out of a downturn.

What Did Keynes Believe Caused Recessions and Depressions