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Hi, could you help write reflective journal on Keynesian economics There are three principal tenets in the Keynesian description of how the economy works: 1.

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Hi, could you help write reflective journal on Keynesian economics

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There are three principal tenets in the Keynesian description of how the economy works: 1. Aggregate demand is influenced by many economic decisionspublic and private Private sector decisions can sometimes lead to adverse macroeconomic outcomes, such as reduction in consumer spending during a recession. These market failures sometimes call for active policies by the government, such as a fiscal stimulus package. Therefore, Keynesian economics supports a mixed economy guided mainly by the private sector but partly operated by the government. 2. Prices, and especially wages, respond slowly to changes in supply and demand This results in periodic shortages and surpluses, especially of labor. There are three principal tenets in the Keynesian description of how the economy works: 3. Changes in aggregate demand have their greatest short-run effect on real output and employment Keynesians believe that, because prices are somewhat rigid, fluctuations in any component of spendingconsumption, investment, or government expenditurescause output to change. If government spending increases, for example, and all other spending components remain constant, then output will increase. Keynesian models of economic activity also include a multiplier effect; that is, output changes by some multiple of the increase or decrease in spending that caused the change. If the fiscal multiplier is greater than one, then a one dollar increase in government spending would result in an increase in output greater than one dollar

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