Answer to Question #89474 in Macroeconomics for Sofia Bale

Question

Classical economists believe that if the economy is let on its own, without any intervention such as in a. above, there will be automatic adjustments towards full employment equilibrium. Explain

Answer 1

Classical economists believe that if the economy is left on its own, without any intervention such as in a. above, there will be automatic adjustments towards full employment equilibrium, but this will occur only in the long run and may take a lot of time.