Question

which among the following is not a feature of keynesian theory​

Answer 1

Answer: Wage Price Flexibility

Explanation:

The key characteristics of the Keynesian theory of employment that define its fundamental nature are as follows:

1) It is a generic theory in that it (a) addresses all employment levels, whether they are full employment, growing unemployment, or an intermediate level; Because these conditions essentially revolve around the amount of employment, it also readily explains inflation. Furthermore, it relates to changes in output and employment in the economy as a whole.

2) A short-term theory called the Keynesian theory of employment makes an effort to analyse the phenomena of unemployment in the short run. He made all of the strategic variables that are stable and vary very little in the short term, constant assumptions.
3)Keynes lacked much confidence in the laissez-faire approach and the idea of the economy's mechanism adjusting itself automatically. He supported government action to change the capitalism system, on the other hand.
4)) According to this theory, Keynes accorded money a significant role in the choice of output growth throughout the entire economic system.
5)Keynesian theory has significant policy ramifications and is grounded in empirical research.

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Answer 2

Answer:

Wage Price Flexibility

Explanation:

Some of the basic features of Keynes theory of income and employment are as follows:

1.    Output employment and income are interchangeable terms.

2.    Employment and income depend on effective demand.

3.    Effective demand is governed by aggregate demand and aggregate    supply.

4.    Since aggregate supply remains constant in the short-run, Keynes concentric on the aggregate demand.

5.    Aggregate demand in a two sector economy (i.e., households and firms) is determined by consumption expenditure and investment expenditure.

6.    Consumption expenditure is determined by

     (i) the size of income, and

     (ii) propensity to consume.

7.    Propensity to consume may be of two kinds:

   (i) Average propensity to consume, and

  (ii) Marginal propensity to consume.

8.    The propensity to consume is relatively stable.

9.    If the propensity to consume remains unchanged, employment   depends upon the investment expenditure.

10.    Investment depends upon

       (i) the rate of interest

       (ii) the marginal efficiency of capital.

11.    Marginal efficiency of capital, in turn, is determined by

      (i) supply price of capital asset,

      (ii) prospective yield from the capital asset.

12.    The rate of interest is determined by

       (i) the supply of money,

       (ii) the demand for money.

        The demand for money depends upon the liquidity preference.

13.    The liquidity preference is determined by three motives :

       (i) Transactions motive,

       (ii) precautionary motive, and

       (iii) Speculative motive.

       The supply of money is controlled by the government.

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