Q16 Which of the following statements is/are TRUE of the major schools of economic thought? i. Keynesians believe in the use of macroeconomic tools to stabilise the economy whereas the others do not. ii. Monetarists believe that monetary policy is more effective than fiscal policy in eliminating unemployment, whereas Keynesians believe the opposite. iii. Supply-siders believe that incentives to work, save and invest are more important than macroeconomic demand manipulation in managing the economy. iv. The classical economists believed that the monetary and real sides of the economy wereentirely separate, whereas the other schools believe that the monetary sector can affectthe real economy, at least in the short run. a) i b) i and ii c) i, iii and iv d) ii, iii and iv
Q16
Which of the following statements is/are TRUE of the major schools of economic thought?
i.
Keynesians believe in the use of macroeconomic tools to stabilise the economy whereas the others do
not.
ii.
Monetarists believe that monetary policy is more effective than fiscal policy in eliminating unemployment,
whereas Keynesians believe the opposite.
iii. Supply-siders believe that incentives to work, save and invest are more important than macroeconomic
demand manipulation in managing the economy.
iv. The classical economists believed that the monetary and real sides of the economy wereentirely separate,
whereas the other schools believe that the monetary sector can affectthe real economy, at least in the short
run.
a) i
b) i and ii
c) i, iii and iv
d) ii, iii and iv
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