Question

Read the two statements and decide if they are true or false (I) Classical economists believe that prices are inflexible and that demand creates supply, so we should focus on increasing spending and stimulating aggregate demand to boost the economy out of a recession. (II) Keynesian economists believe that prices are flexible and that supply creates demand, and so we should focus on production rather than just increased spending.

Answer 1

Answer:

Both I and II are false

Explanation:

In the given situation, the condition should be reversed that means The Keynesian economists said that demand created the supply while on the other hand as per the classical economist it said that the supply created the demand

Therefore as per the given situation, both the statements are false as the reversion of the conditions are given in the question

The same is to be considered