Question

Which of the following is true about new Keynesian economics?

a. It incorporates monetarist ideas about the importance of monetary policy.
b. It incorporates new classical ideas about the importance of aggregate supply.
c. It includes a greater use of microeconomic analysis in macroeconomic analysis than Keynesian economics.
d. Unlike Keynesian economics, it is opposed to active stabilization policies.

Answer 1

A) It incorporates monetarist ideas about the importance of monetary policy.

B) It incorporates new classical ideas about the importance of aggregate supply.

C) It includes a greater use of microeconomic analysis in macroeconomic analysis than Keynesian economics.

Step-by-step explanation:

An issue with traditional Keynesian economics is that it focused to much on the short run. Therefore new Keynesian economists included more classical policies that also focus on the long run. No Keynesian economic plan can be successful without an appropriate monetary policy.