According to the Keynesian view, the prolonged unemployment of the Great Depression
a. was surprising because Keynesians believed that wage rates would decline and direct the economy to full employment.
b. was surprising because Keynesians believed that lower interest rates would direct the economy to full employment.
c. resulted because the total expenditures on goods and services were less than the full-employment rate of output.
d. resulted because the federal government ran large budget deficits during the 1930s.
C
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Product differentiation involves making a product that is
A) slightly different from the products of competing firms. B) no different than the products of competing firms. C) very different from the products of competing firms. D) completely different from the products of competing firms. E) cheaper than the products of competing firms.
Why is normal profit an opportunity cost?
What will be an ideal response?
? Assume that Figure 4-4 shows demand for skirt steak, which is used to make fajitas. A decrease in the price of tortillas will change demand from
A. D1to D2. B. D2to D1 C. D3to D2. D. D3to D1.
When households find themselves holding too much money, they respond by
a. purchasing interest-earning financial assets and interest rates fall. b. purchasing interest-earning financial assets and interest rates rise. c. holding the extra money and interest rates rise. d. selling interest-earning financial assets, which eliminates the excess supply of money.