According to the New Classical macroeconomic school,
A)active policy intervention is ineffective.
B)active policy intervention is undesirable and perverse.
C)active policy intervention's benefits exceed its costs.
D)active policy intervention's benefits are less than its costs.

Question

Quizplus · Accepted Answer

According to the New Classical macroeconomic school, active policy intervention is ineffective. This school argues that the economy is inherently stable, and any deviations from full employment will be self-correcting through market forces without the need for government intervention. Therefore, any attempts by policymakers to stimulate the economy through fiscal or monetary policy will be ineffective and only lead to inflationary pressures.

According to the New Classical Macroeconomic School