Asked by Vanessa McKeiver on May 06, 2024

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Which of the following is false?

A) Keynes believed that the economy was basically unstable.
B) The classical economists believed that full employment was a "rare occurrence."
C) Keynes argued that the expected rate of profit was the most important factor in determining the level of investment demand in an economy.
D) The classical economists used the laws of supply and demand to prove the validity of Say's Law.

Keynes

A reference to John Maynard Keynes, a British economist whose ideas fundamentally changed the theory and practice of macroeconomics and the economic policies of governments.

Classical Economists

Economists, primarily from the 18th and 19th centuries, who believed in the importance of free markets, competition, and the self-regulating nature of economies.

Investment Demand

The total demand for goods and services within an economy that represents an investment by businesses or individuals.

  • Comprehend the basic distinctions between classical and Keynesian theories of economics.
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GM
Gaida MohdMay 12, 2024
Final Answer :
B
Explanation :
Classical economists actually believed that the economy would naturally adjust to achieve full employment, not that it was a "rare occurrence." This belief contrasts with Keynesian economics, which posits that the economy can remain in a state of disequilibrium (such as underemployment) for a significant period.