An Advantage of Stabilizing Macroeconomic Policy Over Economic Self-Correction Is

question 188

Multiple Choice

An advantage of stabilizing macroeconomic policy over economic self-correction is that:

• A) stabilization policies achieve potential output with a lower aggregate price level.
• B) economic self-correction can take a decade or more.
• C) economic self-correction affects the aggregate price level but not the aggregate output level.
• D) stabilization policies are particularly effective to address supply shocks.

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