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Classical Economists Believe That Government Intervention in the Economy Is

Question 103

Multiple Choice

Classical economists believe that government intervention in the economy is unnecessary because


A) prices are flexible and, therefore, the economy will adjust back to full employment on its own.
B) savings is a drain on output and must be limited.
C) the short run is more important than the long run, and economic policy only works in the short run.
D) prices are sticky and will not prevent the economy from adjusting to full employment.
E) supply is less important than demand in determining economic output.

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