While researching a topic, a student has taken the following notes:Following the Great Depression, economist John Maynard Keynes proposed that...
GMAT Expression of Ideas : (Expression) Questions
While researching a topic, a student has taken the following notes:
- Following the Great Depression, economist John Maynard Keynes proposed that government spending could stimulate economic recovery.
- Keynes published The General Theory of Employment, Interest and Money in 1936, advocating active fiscal intervention during economic downturns.
- His approach became the foundation for New Deal policies and dominated economic thinking for decades.
- In the 1970s, economist Milton Friedman challenged Keynesian economics with his monetarist theory.
- Friedman argued that controlling money supply, rather than government spending, was key to economic stability.
- Friedman's monetarist policies gained influence and were implemented during the 1980s, marking a shift away from Keynesian approaches.
The student wants to place Keynes' economic position within its historical context. Which choice most effectively uses relevant information from the notes to accomplish this goal?
Keynes published The General Theory in 1936, disagreeing with Friedman's argument that government spending could stimulate economic recovery during downturns.
The economists involved in post-Depression policy debates included influential figures like Keynes, who advocated approaches that Friedman would later challenge.
Following the Great Depression, Keynes developed his theory of fiscal intervention, though Friedman's monetarist challenge would later shift economic policy away from government spending approaches.
In the 1930s, Keynes and Friedman presented competing theories; Friedman's monetarist approach would eventually gain influence and reshape policy in the 1980s.
Step 1: Decode and Map the Passage
Part A: Passage Analysis Table
| Text from Passage | Analysis |
|---|---|
| "Following the Great Depression, economist John Maynard Keynes proposed that government spending could stimulate economic recovery." |
|
| "Keynes published The General Theory of Employment, Interest and Money in 1936, advocating active fiscal intervention during economic downturns." |
|
| "His approach became the foundation for New Deal policies and dominated economic thinking for decades." |
|
| "In the 1970s, economist Milton Friedman challenged Keynesian economics with his monetarist theory." |
|
| "Friedman argued that controlling money supply, rather than government spending, was key to economic stability." |
|
| "Friedman's monetarist policies gained influence and were implemented during the 1980s, marking a shift away from Keynesian approaches." |
|
Main Point: The notes trace how economic thinking evolved from Keynes' government-spending approach following the Great Depression to Friedman's monetarist challenge that gained influence decades later.
Argument Flow: The notes establish Keynes' economic theory as a response to the Great Depression, show its dominance for decades, then present Friedman as a challenger whose alternative approach eventually shifted policy away from Keynesian economics.
Step 2: Interpret the Question Precisely
This is a fill-in-the-blank question asking us to choose the best logical connector. The answer must create the right relationship between what comes before and after the blank.
Step 3: Prethink the Answer
- To place Keynes within historical context, the correct answer should:
- Connect his theory to the historical circumstances that prompted it (Great Depression)
- Show the timeline of his influence
- Relate his ideas to later developments (Friedman's challenge and policy shift)
- The answer should show Keynes as part of an ongoing conversation in economics, not just state his views in isolation.
Keynes published The General Theory in 1936, disagreeing with Friedman's argument that government spending could stimulate economic recovery during downturns.
✗ Incorrect
- Claims Keynes disagreed with Friedman's argument about government spending. This gets the timeline wrong - Friedman came later and disagreed with Keynes, not vice versa.
The economists involved in post-Depression policy debates included influential figures like Keynes, who advocated approaches that Friedman would later challenge.
✗ Incorrect
- Mentions post-Depression debates and notes Friedman would later challenge Keynes. Doesn't provide the specific historical context (Great Depression) or explain what Keynes actually proposed.
Following the Great Depression, Keynes developed his theory of fiscal intervention, though Friedman's monetarist challenge would later shift economic policy away from government spending approaches.
✓ Correct
- Shows the historical trigger (Great Depression) that led to Keynes' fiscal intervention theory. Demonstrates the later challenge from Friedman's monetarism. Places Keynes in a complete historical arc from emergence to eventual policy shift away from his ideas.
In the 1930s, Keynes and Friedman presented competing theories; Friedman's monetarist approach would eventually gain influence and reshape policy in the 1980s.
✗ Incorrect
- Claims both economists presented competing theories "in the 1930s". This is factually wrong based on the notes - Friedman's challenge came in the 1970s.