Based on the belief that prices are very flexible,classical economists conclude that
A) the economy can become stuck at high levels of unemployment for long periods of time.
B) government intervention in the economy is unnecessary.
C) the economy will experience wild swings in output and employment.
D) the best type of economy is centrally planned and run by the state.
E) government intervention in the economy is very necessary.

Question

Quizplus · Accepted Answer

Classical economists believe that prices are very flexible and will adjust quickly to changes in supply and demand. Therefore, they argue that government intervention in the economy is unnecessary and may even be harmful. They also believe that the economy is self-correcting and will tend towards full employment in the long run.

Based on the Belief That Prices Are Very Flexible,classical Economists