The Main Difference Between the Keynesian and Classical Models Is

question 70

Multiple Choice

The main difference between the Keynesian and Classical models is that

• A)the Keynesian model assumes wages are rigid in the short run,but the Classical model assumes economic agents experience price misperception.
• B)the Classical model assumes expectations are rational,but the Keynesian model assumes economic agents do not have rational expectations.
• C)the Keynesian model suggests that anticipated changes in policies have real effects,but the Classical model suggests that only unanticipated changes in policies have real effects.
• D)the aggregate supply curve is upward sloping in the Keynesian model but vertical in the Classical model.

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