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Business, 01.07.2019 19:20 Delgadojacky0206

Classify each of the statements as true or false. classical macroeconomists believed that unemployment could be kept low only through monetary policy free of political influence. discretionary fiscal policy is the preferred method of economic stabilization by modern macroeconomists because it avoids the risk of a political business cycle. originally, monetarists believed that since the velocity of money was stable in the short run, the best way to assure economic growth was to gradually and consistently increase the money supply. the key result of real business cycle theory is that the expectations of business owners is the primary driver of the business cycle because these expectations will affect their decisions, resulting in real economic impacts. the political business cycle captures the relationship between the political party in office and the growth rate of the economy.

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