The Classical Approach to Macroeconomics Assumes That

question 14

Multiple Choice

The classical approach to macroeconomics assumes that

• A)wages, but not prices, adjust quickly to balance quantities supplied and demanded in markets.
• B)wages and prices adjust quickly to balance quantities supplied and demanded in markets.
• C)prices, but not wages, adjust quickly to balance quantities supplied and demanded in markets.
• D)neither wages nor prices adjust quickly to balance quantities supplied and demanded in markets.

---

Definitions:

Brain Stem

The part of the brain connecting the spinal cord with the forebrain and cerebrum, controlling basic life functions like breathing, heart rate, and arousal.

Frontal Lobes

The part of the brain located at the front of each cerebral hemisphere, responsible for voluntary movement, speech, and complex cognitive functions.

Frontal Lobes

The part of the brain located in the frontal region, responsible for higher cognitive functions including decision making, problem-solving, and controlling social behavior.

Hippocampus

A crucial part of the brain's limbic system involved in memory formation and spatial navigation.