At the beginning of the Great Depression
A) neoclassical economists insisted that the government should increase spending.
B) neoclassical economists predicted that the economy would soon return to normal.
C) neoclassical economists agreed that the problem was lack of effective demand.
D) neoclassical economists predicted the fall of capitalism.

Question

Quizplus · Accepted Answer

Neoclassical economists at the beginning of the Great Depression believed that the economy would soon return to normal and did not see the severity of the crisis. They believed in the self-correcting nature of the market and did not support government intervention to stimulate demand. It was not until later in the Depression that some neoclassical economists began to recognize the need for government intervention to restore full employment.

At the Beginning of the Great Depression