Adam Believes That in the Long Run All Prices Are

question 281

Multiple Choice

Adam believes that in the long run all prices are flexible and that any increase in the money supply will lead only to inflation, not to an increase in aggregate output. Because the economy would self-correct to long-run equilibrium output, there is no role for either fiscal or monetary policy. Adam is best described as a:

• A) supply-sider.
• B) Keynesian.
• C) classical economist.
• D) monetarist.

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