British Economist John Maynard Keynes argued that - Supply creates its own demand.Demand creates its own supply.The economy should be allowed to run its course.The government should not interfere with the functioning of the economy.
Question
British Economist John Maynard Keynes argued that - Supply creates its own demand.Demand creates its own supply.The economy should be allowed to run its course.The government should not interfere with the functioning of the economy.
Solution
John Maynard Keynes, the British economist, argued that demand creates its own supply. This is a key principle of Keynesian economics, which emphasizes the importance of aggregate demand in driving economic activity. Keynes believed that in times of economic downturn, the government should intervene by increasing public spending to stimulate demand and pull the economy out of recession. This is in contrast to the laissez-faire economic theory, which argues that the economy should be allowed to run its course without government interference.
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According to Keynesian theory: the economy is self regulatingspending is the driving force in the economysupply creates its own demand
according to the analysis of the british economist john maynard keynesmarkets coordinate supply and demand so that a policy of laissez-faire would prevent recessions.economic fluctuations were the cumulative result of mistakes made by businesses and households in an uncertain world.government demand could be used to smooth fluctuations in aggregate output and income.supply creates its own demand through the circular flow of economic activity.
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Which Economy is run by Supply and Demand?Group of answer choicesMarket EconomyMixed EconomyTraditional EconomyNo answer text provided.Next
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