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Keynes theory is associated with :
Effective demand
Propensity to consume
Propensity to save
All of these
- Effective demand: This is central to Keynesian economics. It emphasizes that the level of demand determines overall economic activity and employment. A mismatch can lead to recessions.
- Propensity to consume: This is also important in Keynesian thought. It describes the portion of income people are likely to spend rather than save, influencing economic demand.
- Propensity to save: Discussed by Keynes, it is the complement of the propensity to consume. It’s vital for understanding savings behavior and its economic effects.
- Correct Answer: Option 4, All of these. Keynes' theory indeed touches upon effective demand, consumption habits, and savings.
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