Questions: Consider the economy is currently experiencing overall market inflation. Which of the options below communicates a Keynesian perspective? - Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies. - Let the regulated market solve inflation through long-term market price correction - We should catch more Pokemon to solve our problems. - Wait why is the Federal Reserve already printing so much money causing inflation? Our government should not be attempting to manipulate these interest rates.

Consider the economy is currently experiencing overall market inflation. Which of the options below communicates a Keynesian perspective?

- Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies.
- Let the regulated market solve inflation through long-term market price correction
- We should catch more Pokemon to solve our problems.
- Wait why is the Federal Reserve already printing so much money causing inflation? Our government should not be attempting to manipulate these interest rates.
Transcript text: Consider the economy is currently experiencing overall market inflation. Which of the options below communicates a Keynesian perspective? Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies. Let the regulated market solve inflation through long-term market price correction We should catch more Pokemon to solve our problems. Wait why is the Federal Reserve already printing so much money causing inflation? Our government should not be attempting to manipulate these interest rates.
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Solution

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Answer

The answer is: Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies.

Explanation
Option 1: Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies.

This option aligns with a Keynesian perspective, which advocates for active government intervention to manage economic fluctuations. Keynesians believe that during inflationary periods, the government and central bank should take measures to control inflation, such as adjusting interest rates and modifying subsidies to influence economic activity.

Option 2: Let the regulated market solve inflation through long-term market price correction

This option reflects a more laissez-faire or classical economic perspective, which suggests that the market should be left to correct itself without government### Answer The answer is: Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies.

Explanation
Option 1: Have the Federal Reserve and federal government take action through increased interest rates and decreased producer subsidies.

This option aligns with a Keynesian perspective, which advocates for active government intervention to manage economic fluctuations. Keynesians believe that during inflationary periods, the government and central bank should take measures to control inflation, such as adjusting interest rates and modifying subsidies to influence economic activity.

Option 2: Let the regulated market solve inflation through long-term market price correction

This option reflects a more laissez-faire or classical economic perspective, which suggests that the market should be left to correct itself without government intervention. This is contrary to the Keynesian approach, which supports active policy measures.

Option 3: We should catch more Pokemon to solve our problems.

This option is not a serious economic proposal and does not relate to any recognized economic theory, including Keynesian economics.

Option 4: Wait why is the Federal Reserve already printing so much money causing inflation? Our government should not be attempting to manipulate these interest rates.

This option suggests a critique of government intervention and monetary policy, which is more aligned with monetarist or Austrian economic perspectives, rather than Keynesian. Keynesians generally support the use of monetary policy to manage economic conditions.

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