Which of the following factors strengthens the case for policy activism?

Question

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Sticky prices imply that a shock to the economy (such as a recession) will take longer to correct itself as prices do not adjust quickly. This provides a case for policy activism to intervene and correct the shock by increasing demand through monetary or fiscal policy. Flexible wages and prices would mean that the economy can easily adjust to shocks without intervention. The lack of real-business-cycles means that fluctuations in the economy are not caused by external shocks, but rather by inherent factors of the economy itself, which could argue against policy activism because it may not be effective in addressing those factors.

Which of the Following Factors Strengthens the Case for Policy