The classical theory of aggregate supply where markets are perfectly flexible
a. may or may not be compatible with the Keynesian system.
b. is easily added the IS-LM framework of aggregate demand.
c. is fundamentally incompatible with the Keynesian system.
d. is consistent with the IS-LM framework if all shocks are to the IS curve.
e. none of the above.
C
Economics
You might also like to view...
Which of the following explains why the aggregate demand curve is downward sloping?
A) the open economy effect B) the real-balance effect C) the interest rate effect D) all of the above
Economics
In the figure above, when 40 units are produced the average fixed cost is
A) $4. B) $8. C) $12. D) $20.
Economics