According to Keynes, what is the role of the government in maintaining full employment?

CA Foundation · Business Economics · MTP · April 2025
According to Keynes, what is the role of the government in maintaining full employment?
(A) A. Limited role, as the market will self-adjust
(B) B. Active role through fiscal and monetary policies
(C) C. Passive role, focusing on international trade
(D) D. No role, as unemployment is a natural part of the business cycle

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. Active role through fiscal and monetary policies

Topics: Determination of National Income

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