According to conservative economists, how does the economy recover from an external shock?
A) Government policy can help to stabilize the economy.
B) The economy will restore itself to equilibrium automatically.
C) Another outside shock will counteract the first shock.
D) External shocks have no impact on an economy as large as the United States.

Question

Quizplus · Accepted Answer

Conservative economists often believe in the self-correcting nature of markets. They argue that, given time, the economy will adjust on its own to return to equilibrium after an external shock, without the need for government intervention. This belief is rooted in classical economic theories that emphasize the efficiency of free markets.

According to Conservative Economists, How Does the Economy Recover from an External