The reason the income and expenditure shortrun macro model s

The reason the income and expenditure (short-run) macro model suggests that the economy can operate either above or below its potential while in the long-run classical model the economy operates automatically at full employment is that

a. the short-run macro model is flawed and inaccurate

Solution

They measure completely different aspects of economy. In one model full adjustment does not occur but in other it occurs

The reason the income and expenditure (short-run) macro model suggests that the economy can operate either above or below its potential while in the long-run cl

Get Help Now

Submit a Take Down Notice

Tutor
Tutor: Dr Jack
Most rated tutor on our site