What core idea of Keynesian economics influenced New Deal policies during the Great Depression?
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Correct answer: Government intervention to stimulate demand
Keynesian economics emphasizes that government spending can boost aggregate demand during economic downturns. This idea directly influenced New Deal programs aimed at economic recovery.
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More Keynesian Economics and New Deal questions
- Which New Deal program best reflects Keynesian principles of government spending to create jobs?
- John Maynard Keynes argued that during economic downturns, governments should:
- Which New Deal policy aimed to stabilize prices and wages in line with Keynesian ideas?
- How did the New Deal reflect Keynesian thought regarding unemployment?
- Which concept is central to Keynesian economics and was applied in the New Deal?
- Which New Deal agency was designed to provide immediate financial assistance to citizens, reflecting Keynesian ideas?