Which of the Following Economic Statements Would a Classical Economist

question 158

Multiple Choice

Which of the following economic statements would a classical economist tend to support?

• A) The short run deserves more focus than the long run.
• B) The market tends toward stability and full employment.
• C) Savings is a drain on aggregate demand and can reduce economic growth.
• D) Government intervention is often necessary to stimulate or moderate economic performance.
• E) Prices tend to be rigid and inflexible.

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Definitions:

Stable

In an economic context, it refers to a situation or condition that is not significantly changing or is predictable and thus not subject to rapid fluctuations.

Noncooperative Games

A type of game theory in which players make decisions independently, without colluding or forming alliances, often leading to suboptimal outcomes for all involved.

Homogeneous Good

A product or service that is considered identical or very similar no matter who produces it, making price the main differentiator.

Nash Equilibrium

A concept in game theory where no participant can gain by a unilateral change of strategy if the strategies of the others remain unchanged.