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Self-corrective Forces
Mechanisms within the market economy that work to naturally correct imbalances and return the economy to a state of equilibrium without external intervention.
Rational Expectations
The hypothesis that individuals form forecasts about the future based on all available information in a way that is consistent with the actual structure of the economy.
Active Stabilization Policy
Economic policies aimed at minimizing business cycle fluctuations through fiscal and monetary interventions by the government.
Money Supply
The total amount of money available in an economy at a particular time, including cash, coins, and balances held in checking and savings accounts.
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