In the Classical Model,flexible Prices and Wages Serve to

question 125

Multiple Choice

In the classical model,flexible prices and wages serve to

• A)self-correct the economy guaranteeing a constant price level and a constant level of output.
• B)self-correct the economy above to the natural rate of unemployment,and constant price level.
• C)ensure that stabilization policy is not required on the part of fiscal authorities.
• D)none of the above

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Definitions:

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A psychological framework suggesting that individuals have a collection of beliefs about themselves that influence their behavior and attitudes.

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