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_____ is of the view that fluctuations in economic activities are because of fluctuations in aggregate effect demand.
  • a)
    Keyens
  • b)
    Schumpeter
  • c)
    Nicholas Kaldor
  • d)
    Joan Robinson
Correct answer is option 'A'. Can you explain this answer?
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_____ is of the view that fluctuations in economic activities are beca...
Keynes' View on Economic Fluctuations

Keynesian economics is a macroeconomic theory that was developed by John Maynard Keynes. According to Keynes, fluctuations in economic activities are due to fluctuations in aggregate demand. This theory became extremely popular after the Great Depression, where Keynesian policies were used to revive the economy.

Factors that Affect Aggregate Demand

Aggregate demand refers to the total demand for goods and services in an economy. According to Keynes, fluctuations in aggregate demand are caused by changes in the following factors:

1. Consumption: Consumer spending is the largest component of aggregate demand. Changes in consumer behavior can cause fluctuations in demand.

2. Investment: Investment spending refers to businesses investing in capital goods such as machinery, equipment, and buildings. Changes in investment spending can also affect aggregate demand.

3. Government Spending: Government spending can increase aggregate demand by directly purchasing goods and services. Keynes believed that government spending could be used to stimulate the economy during times of recession.

4. Net Exports: Net exports refer to the difference between exports and imports. When exports are greater than imports, net exports add to aggregate demand.

Conclusion

Keynesian economics is based on the belief that government intervention in the economy is necessary to stabilize fluctuations in economic activity. According to Keynes, fluctuations in aggregate demand are the main cause of economic fluctuations. By understanding the factors that affect aggregate demand, policymakers can use Keynesian policies to stabilize the economy.
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_____ is of the view that fluctuations in economic activities are beca...
Schumpeter gave innovation theory. Nicholas caldor gave cobweb theory. Robinson gave definition of business economics. Hence option A will be the right answer
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Features of a Mixed Economy:A mixed economy is an economic system that combines elements of both a market economy and a planned economy. It incorporates features of both private enterprise and government intervention. The correct answer is D, as all of the following features are characteristic of a mixed economy:1. Planned economy:A mixed economy includes elements of a planned economy, where the government plays a role in guiding and regulating economic activities. It formulates economic plans and policies to ensure the efficient allocation of resources and to promote economic stability.2. Dual system of pricing:In a mixed economy, there exists a dual system of pricing, which means that both market prices and government-set prices coexist. While market forces determine prices for most goods and services, the government may intervene to regulate prices in certain sectors to protect consumers or promote social welfare.3. Balanced regional development:Another characteristic of a mixed economy is the emphasis on balanced regional development. The government intervenes to ensure that economic growth and development are not concentrated in specific regions or industries but are spread across different regions and sectors. This helps to reduce regional disparities and promote overall economic stability and social welfare.Benefits of a Mixed Economy:A mixed economy offers several benefits due to its combination of market forces and government intervention. Some of these benefits include:1. Economic efficiency:By incorporating market mechanisms, a mixed economy allows for resource allocation based on supply and demand, which promotes economic efficiency. Market forces encourage competition, innovation, and productivity, leading to higher levels of economic growth.2. Social welfare:Government intervention in a mixed economy enables the provision of public goods and services that may not be adequately provided by the market alone. This includes areas such as healthcare, education, infrastructure, and social security, ensuring a certain level of social welfare and equity.3. Stability and regulation:The government's role in a mixed economy helps to maintain economic stability through macroeconomic policies such as fiscal and monetary measures. It also regulates certain sectors to prevent market failures, protect consumer rights, and ensure fair competition.Conclusion:A mixed economy combines the advantages of both market forces and government intervention. It allows for economic efficiency, social welfare, and stability. The features of a mixed economy include elements of a planned economy, a dual system of pricing, and balanced regional development. These features work together to create a system that promotes both economic growth and social welfare.

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_____ is of the view that fluctuations in economic activities are because of fluctuations in aggregate effect demand.a)Keyensb)Schumpeterc)Nicholas Kaldord)Joan RobinsonCorrect answer is option 'A'. Can you explain this answer?
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