Question

9. For Keynes, the real problem of unemployment lay in a lack of ?

10. What did Keynes mean by "in the long run we are all dead."?

11. According to Keynes, what was needed to break the cycle of economic depression?

12. If market mechanisms were unable to stimulate recovery then it was the job of the __________ to step in and create _______ by running, if necessary a very large budget __________ in order to create __________.

Answer 1

ANS 9.

According to Keynes the problem of the unemployment lays in the lack of expenditures as due to lack of expenditure of the people the demand in the economy will be less and income of the firms will be less, so the firms terminate employees because of less demand and less income.

ANS 10

With the statement in the long run we are all dead Keynes made in 1932 after world war 1, he symbolized that the world is moving from capitalism to liberal capitalism. Also he meant that the economists were not able to forsee the longterm issues .

ANS 11

According to Keynes government intervention was required to break the economic depression. as the government would stimulate the investment which would create employment and money supply with people and would increase in demand and would break depression.

ANS 12

If market mechanisms were unable to stimulate recovery then it was the job of the _Government_________ to step in and create _employment______ by running, if necessary a very large budget __investment________ in order to create _demand_________.