The Keynesian Economics Quiz
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Questions and Answers

According to John Maynard Keynes, what is the main cause of unemployment?

  • Lack of competition
  • Lack of central planning
  • Lack of government intervention
  • Lack of spending (correct)

    • During recessions, why does demand decrease?

  • People have more money to spend
  • People choose not to spend
  • People spend on non-essential items
  • People have less money to spend (correct)

    • What is Friedrich A. Hayek's view on central planning?

  • It is essential for economic growth
  • It is beneficial for making economic decisions
  • It is not good at making economic decisions (correct)
  • It leads to healthy markets

    • According to Milton Friedman, why wouldn't government fine-tuning work?

    <p>The economy is too simple</p> Signup and view all the answers

    What role does John Maynard Keynes suggest the government should play in economic management?

    <p>Major role</p> Signup and view all the answers

    What does Keynes propose the government should do during a market downturn?

    <p>Borrow money and spend it</p> Signup and view all the answers

    What does Hayek believe is the result of less government intervention?

    <p>More freedom</p> Signup and view all the answers

    What is the main criticism of government fine-tuning according to Friedman?

    <p>The economy is too complex</p> Signup and view all the answers

    What is the main purpose of government borrowing and spending in Keynesian economics?

    <p>To create government-sponsored jobs</p> Signup and view all the answers

    What is the view of Hayek and Friedman on the role of government in economic decision-making?

    <p>Government should have no role</p> Signup and view all the answers

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