"The Market Is Not a Self-Regulating Mechanism Because Prices Are

question 84

Multiple Choice

"The market is not a self-regulating mechanism because prices are not flexible and nothing ensures that planned leakages will be offset by planned injections.To bring the economy out of depression and end high unemployment, some way of stimulating aggregate demand is required.This can be best achieved by a combination of government deficit spending and regulation of tax rates." Which school of thought does this statement best represent?

• A)Rationalist economics
• B)Monetarist economics
• C)Classical economics
• D)Keynesian economics
• E)Marxist economics

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Definitions:

Direct Labor

The cost of wages for workers who are directly involved in the production of goods or services.

Product Cost

The expenses directly related to manufacturing the products a company sells, such as materials, labor, and overhead costs.

Work In Process

Inventory items that are in the process of being manufactured but are not yet complete; it's part of the inventory that is in-between raw materials and finished goods.

Subsidiary Ledger

A detailed ledger that contains the individual accounts needed to support a specific general ledger account.