The Hands-Off View of the Classical School Rests on Which

question 16

Multiple Choice

The hands-off view of the classical school rests on which of the following two simple propositions about markets?

• A) Demand creates its own supply and markets are basically competitive.
• B) Markets are basically competitive and prices are flexible.
• C) Market failure occurs and prices are rigid.
• D) Wages are sticky downward and market failure is inevitable.