Discussion
Who among the following advocated and active fiscal policy to reduce unemployment ?
Answer: B
It was advocated by the Keynesian economists.
Keynes argued that unemployment comes from deficient aggregate demand, which the economy may not correct by itself. Government spending and tax cuts raise demand, and through the multiplier, output and employment. Active fiscal policy is therefore central to Keynesian economics.
Classical economists believed markets clear and Say's law holds, so they saw no need for fiscal intervention. Monetarists stress stable money growth and doubt the power of fiscal policy, so 'both' and 'monetarist' are also wrong.
No comment is present. Be the first to comment.
Loading…
Post your comment
Please log in or register to post a comment.
Examination Categories
- SSC Exams
- Banking Exams
- Teaching Exams
- Civil Services Exams
- Railways Exams
- Engineering Recruitment Exams
- Defence Exams
- State Government Exams
- Police Exams
- Insurance Exams
- Nursing Exams
- Other Government Exams
- NRA CET
- PG Entrance Exams
- Campus Placement
- MBA Entrance Exams
- CUET and UG Entrance
- Judiciary Exams
- Regulatory Body Exams
- Software Development