Keynesian economics addresses economic problems by having governments and central banks intervene to influence aggregate demand through fiscal and monetary policy. It responds to economic downturns by advocating for increased government spending and lower interest rates to stimulate demand. Important details include that governments should run deficits during recessions and surpluses during booms, and that proper understanding requires considering factors like inflation, unemployment, and business cycles.

1. Keynesian Economics: clearly provide the following: (1) establish the relevant context in which
the concept(s) are applied and/or the economic/political question/problem the concept(s)
addresses; (2) clearly explain how the concept responds to the problem/question (3) identify
important conceptual details, caveats, qualifiers and integral to a proper understanding of the
concept(s)