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Classical Model and Keynesian Model
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Classical Model and Keynesian Model
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24. Macroeconomic Schools of Thought / Classical Model and Keynesian Model / Problem 9
Problem 9
In the classical model, how does the metaphor of a busy highway illustrate the self-correcting nature of the economy?
A
The highway represents the economy, which clears up on its own over time without intervention.
B
The highway represents the need for price controls to manage traffic flow.
C
The highway represents the role of labor unions in maintaining employment levels.
D
The highway represents government intervention clearing economic obstacles.
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