Classical theory advocates _____________ policy and Keynesian theory advocates ______________ policy.
A) nonintervention; intervention
B) active; nonstabilization
C) stabilization; fixed wage
D) fixed rule; passive

Question

​ Classical theory advocates _____________ policy and Keynesian theory advocates ______________ policy.
A) ​nonintervention; intervention
B) ​active; nonstabilization
C) ​stabilization; fixed wage
D) ​fixed rule; passive

Quizplus · Accepted Answer

Classical theory suggests that markets are self-correcting and advocate for nonintervention by the government in the economy, while Keynesian theory argues that during times of economic downturn, active government intervention and policies are necessary to adjust demand and stabilize the economy.

​ Classical Theory Advocates _____________ Policy and Keynesian Theory Advocates

Classical Theory Advocates _____________ Policy and Keynesian Theory Advocates