Question

To bring the economy out of a recession, Keynes argued that the government should increase taxes and cut government spending.

a) True
b) False

Answer 1

Keynes argued for a decrease in taxes and an increase in government spending to bring the economy out of a recession.

Step-by-step explanation:

Keynes argued that in order to bring the economy out of a recession, the government should decrease taxes and increase government spending. This approach is known as expansionary fiscal policy and aims to stimulate consumption and investment, thereby shifting the aggregate demand curve to the right. By doing so, the government can help restore economic growth and employment.