Classical economics argued that:
A) the supply curve should remain vertical in the long run.
B) the First World War was fought to free Britain from economic ruin.
C) depression was only a short-run, temporary departure from full-employment equilibrium.
D) funeral plots need to be determined by the market.

Question

Quizplus · Accepted Answer

Classical economists believed in the idea of Say's Law, which stated that "supply creates its own demand". In other words, they believed that in the long run, the economy would always return to full-employment equilibrium and any depressions or economic downturns were only temporary. Therefore, choice C is the correct answer. Choices A, B, and D are incorrect as classical economics did not support these ideas.

Classical Economics Argued That