The economic theory, popular before the Great Depression, that says the economy will automatically adjust to full employment is:
A) classical economics.
B) Keynesian economics.
C) supply-side economics.
D) monetarism.

Question

Quizplus · Accepted Answer

Classical economics posits that markets are self-regulating and, in the absence of external influences, will automatically adjust to deliver full employment through the mechanisms of supply and demand. This theory was dominant before the Great Depression, which challenged its assumptions and led to the development of Keynesian economics.

The Economic Theory, Popular Before the Great Depression, That Says