Which is the primary tool for government to influence aggregate demand according to Keynesian economics?

CA Foundation · Business Economics · MTP · September 2026
Which is the primary tool for government to influence aggregate demand according to Keynesian economics?
(A) A. Monetary policy
(B) B. Fiscal policy
(C) C. Supply-side policies
(D) D. Exchange rate policy

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. Fiscal policy

Topics: Public Finance

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