New classical economics assumes that government has direct control over the equilibrium level of GDP and indirect control over the money supply.

Question

Quizplus · Accepted Answer

New classical economics emphasizes the importance of free markets and considers government interventions as potentially harmful. Therefore, it assumes that government does not have direct control over the equilibrium level of GDP and only minimal, if any, indirect control over the money supply.

New Classical Economics Assumes That Government Has Direct Control Over