The main difference between classical economists and the Keynesians in explaining the SRAS curve is that
A) classicals argue that prices are rigid,but Keynesians argue that wages are rigid.
B) classicals argue that wages are rigid,but Keynesians argue that prices are rigid.
C) classicals argue that output changes with price changes as long as there is misperception about relative price levels,but Keynesians argue that the SRAS curve is positively sloped for the term of the labour contracts.
D) classicals argue that the SRAS curve is positively sloped because of rational expectations,but Keynesians argue that it is because of the failure of rational expectations.
Correct Answer:
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Q1: Which of the following statements about the
Q3: The crowing-out effect occurs because of
A)higher prices
Q5: In the Keynesian model of the business
Q6: In the Keynesian model,the economy can be
Q7: In the Keynesian model,wages and prices are
A)sticky
Q8: Keynesian business cycle theory cannot account for
Q9: Unanticipated increase in the government expenditures would
A)shift
Q10: The crowding-out effect refers to a situation
Q11: In the Keynesian model,
A)the short-run aggregate supply
Q14: Keynesians are skeptical of the classical theory
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