Which of the following statements about the Keynesian model is correct?
a. The economy would achieve full employment if left free from destabilizing government policies.
b. Active monetary is always effective while fiscal policies is rarely so.
c. Both Keynesians and classicists reach the same policy conclusions, but for different reasons.
d. The economy is inherently unstable because of the instability of aggregate demand, which is primarily due to unstable expectations.
e. both b and d.
ANSWER
D
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