Asked by nicole chenye on Jun 06, 2024

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The classical school

A) was the dominant school of economic thought after the Great Depression.
B) advocated laissez-faire.
C) was mainly concerned with aggregate demand.
D) believed that about half of the money saved would be investeD.

Classical School

A branch of economic thought that emphasizes the importance of market forces in determining economic outcomes and the self-regulating nature of the economy.

Great Depression

A severe and prolonged global economic downturn that occurred in the 1930s, marked by massive unemployment and deflation.

Laissez-Faire

The philosophy that the private economy should function without any government interference.

  • Apprehend the foundational differences in theory between classical economics and Keynesian economics.
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LS
Lizbeth ServacioJun 12, 2024
Final Answer :
B
Explanation :
The classical school of economic thought, which emerged in the 18th century, advocated laissez-faire policies, which emphasized free markets and minimal government intervention in economic affairs. This approach was prevalent until the Great Depression, after which Keynesian economics became more widely accepted. The classical school was mainly concerned with supply-side factors such as production, technology, and incentives, and believed that markets were self-regulating and would automatically correct imbalances over time. The idea that about half of the money saved would be invested is a specific concept within the classical school known as the savings-investment identity.