Opponents of Using Policy to Stabilize the Economy Generally Believe

question 22

Multiple Choice

Opponents of using policy to stabilize the economy generally believe that

• A)neither fiscal nor monetary policy have much impact on aggregate demand.
• B)attempts to stabilize the economy decrease the magnitude of economic fluctuations.
• C)unemployment and inflation are not cause for much concern.
• D)economic conditions can easily change between the start of policy action and when it takes effect.

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Definitions:

Cognitive Algebra

A theoretical concept indicating how people integrate information to make judgments and decisions, often using metaphorical mathematical operations such as addition and subtraction.

Balance Theory

A psychological theory suggesting that individuals strive for consistency among their beliefs, attitudes, and sentiments in a triadic relationship.

Triad

In social sciences, a group or relationship that involves three entities, which can significantly differ in dynamics from dyads (two entities).

Two-Component Model

A theory or framework that divides a concept or phenomenon into two distinct parts for better understanding or analysis.