New classical economics contends that policy activism is
A) not warranted, because we don't know enough about the workings of the economy to stabilize it.
B) not warranted; the public defeats discretionary policies because everyone expects them, and therefore, their effectiveness is thwarted.
C) warranted, because discretionary policies have a strong effect on real output.
D) warranted, because expectations are rational only in the short run.
Correct Answer:
Verified
Q66: Use the following to answer questions .
Exhibit:
Q67: In 1965 during the Johnson administration, the
Q68: New classical theory asserts that, because people
Q69: In the new classical view,
A) a change
Q70: According to the monetarists, after an initial
Q72: Consider the following statement: "A consistent countercyclical
Q73: According to new classical economics, individuals will
Q74: Monetarists argue that
A) the Federal Reserve System
Q75: Which of the following groups of economists
Q76: New classical economics
A) differs from classical economics
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