prices are particularly sticky:

A. When there are widespread macroeconomic and monetary disturbances in the economy.

B. When markets are highly competitive.

C. When the economy is at full employment and positive demand shocks are occurring.

D. in the long run

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Darryn D'SouzaLv10

14 Sep 2020

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Related questions

The kinked demand curve model is particularly useful in explaining:

a. Flexible prices in perfectly competitive markets

b. Flexible prices in oligopolistic markets

c. "Sticky" prices in perfectly competitive markets

d. "Sticky" prices in oligopolistic markets

greyyak244

Our last discussion question for this course is a fitting one since it seeks to cap off this introductory look at the macro. by assessing the relevant theory that has been developed to date. As your text indicates, there are two broad schools of macroeconomic thought that have been competing for the public mind over the last few decades. The Keynesian, or Mainstream view, sees the economy as being prone to shocks, and is concerned primarily with achieving full employment, and seeks to use government intervention (primarily activist fiscal policy) at boosting aggregate demand to achieve that objective. The Classical School (including the Monetarist branch of that school) sees the economy as being mostly self-correcting, and is more concerned with macroeconomic stability particularly price stability, and prefers monetary policy over fiscal policy in achieving this goal. Although there has been a fair amount of consensus as to some of the major items of analysis, there still remain some controversies, particularly with regard to whether government policy is even effective at managing the macroeconomy. What do you think of these divergent views as to government policy? Has one side of this debate won the majority of the argument here, or do both sides have points in their favor? In either case, though, are there times when one set of theories is called for, and then times when the other is?