Which of the following is true concerning the Keynesian school of economic thought?
The federal government should leave economic issues to the states.
The federal government should engage in active policymaking to stabilize economic fluctuations.
The federal government should not involve itself in the economy.
The federal government should engage in tax-cuts and increased government spending only when the economy is in jeopardy.
Answer (1)
The Keynesian school of thought advocates for active government intervention to stabilize the economy, particularly during downturns. It emphasizes the need for fiscal policies, such as increased spending and tax cuts, to stimulate economic demand. Thus, the correct answer is that the federal government should engage in active policymaking to stabilize economic fluctuations. ;
