The classical economists felt that there would be no general overproduction of goods because of
A) wage-price flexibility.
B) the law of diminishing utility.
C) the law of comparative advantage.
D) contestable markets.

Question

Quizplus · Accepted Answer

The classical economists believed in wage-price flexibility, which meant that prices and wages would adjust to each other to maintain a balance between supply and demand. Therefore, there would be no general overproduction of goods in the economy. They did not attribute this to the law of diminishing utility, comparative advantage, or contestable markets.

The Classical Economists Felt That There Would Be No General