The key difference between Keynesian and Classical economists is
A)Keynesians believe that monetary and fiscal policies are detrimental to the economy.
B)Keynesians believe wages and prices are perfectly flexible.
C)Keynesians favour a role for government in managing the economy.
D)Classical economists propose a "menu cost" model.
E)Classical economists favour a role for government in managing the economy.

Question

Quizplus · Accepted Answer

The key difference between Keynesian and Classical economists is that Keynesians favour a role for government in managing the economy, while Classical economists believe that the economy is best left to regulate itself without government intervention. Keynesians believe that government intervention, through monetary and fiscal policies, is necessary to manage unemployment and stabilize the economy during periods of recession or inflation. Classical economists, on the other hand, believe that wages and prices are perfectly flexible and will adjust to changes in supply and demand without the need for government intervention.

The Key Difference Between Keynesian and Classical Economists Is