Which of the Following Policy Statements Would a Classical Economist

question 145

Multiple Choice

Which of the following policy statements would a classical economist tend to support?

• A) The government should be prepared to intervene when aggregate demand changes in any way.
• B) The government should only intervene in the economy when aggregate demand decreases.
• C) The government should allow the economy to adjust to changes in aggregate demand on its own,without interference.
• D) The government should frequently change taxes and spending levels to manipulate the economy.
• E) The government should only intervene in the economy when aggregate demand increases.

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Definitions:

Defense Mechanism

Psychological strategies employed by individuals, unconsciously, to protect themselves from anxiety arising from unacceptable thoughts or feelings.

Repression

A defense mechanism where stressful thoughts or memories are unconsciously blocked from entering awareness.

Reaction Formation

A psychological defense mechanism where an individual behaves in a way that is directly opposite to their true feelings or impulses.

College Student

An individual enrolled in an institution of higher education to pursue a degree or certificate.