New classical economists differ from traditional classical economists because new classical economists
A)Focus on budget restraint and the use of monetary policy when the economy overheats.
B)Believe people's rational expectations will lead them to offset government policy.
C)Believe that economic failures are inherent in a capitalist economy.

Question

Quizplus · Accepted Answer

New classical economists believe in the concept of rational expectations, which means that individuals will anticipate and adjust their behavior based on government policy. Therefore, they believe that government intervention in the economy will be offset by individuals' actions, making it difficult to stimulate the economy through policy changes.

New Classical Economists Differ from Traditional Classical Economists Because New