The concept of 'Effective Demand' in Keynesian economics determines:
A. Only the price level
B. Only the interest rate
C. Only the money supply
D. The level of employment and output
Answer: Option D
Solution (By JKSSB Mock Tests)
According to Keynes, the level of effective demand (where aggregate demand equals aggregate supply) determines the equilibrium level of employment and output.
Explanation:
The Lorenz Curve plots the cumulative percentage of income against the cumulative percentage of population and is used to measure income inequality (along with the Gini coefficient).
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