One Key Assumption of the Classical Model Is

question 25

Multiple Choice

One key assumption of the classical model is

• A) government spending plays a major role.
• B) money illusion cannot fool workers.
• C) wages are sticky.
• D) prices are sticky.

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Definitions:

Positive Effects

Outcomes or impacts that are beneficial or advantageous to an individual, group, or society.

Average Product

The output per unit of input, calculated by dividing total product by the quantity of input used in its production.

Marginal Product

The additional output generated by employing one more unit of a specific factor of production.

Total Product

The total quantity of output produced by a firm during a given period of time.