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John Maynard Keynes was the first to demonstrate how governmental policy may be used to alter total output and avert recessions through economic stabilisation. Describe the state of the global economy at the time Keynes wrote. Describe the state of the American economy now. What initiatives were put forth by the presidential contenders in the 2008 election to avert or reverse a 2008–2009 recession? From John Maynard Keynes' perspective, were the acts taken appropriate? Did they produce the intended results?
Solution
VerifiedIn the following exercise, we explained the Keynesian theory and how it was a solution to the Great Depression of the 1930s in the U.S. In addition, we evaluated how the implementation of the Keynesian policy in the financial crisis of 2008.
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