Question

ccording to the classical​ economists,

A.
the interest rate will ensure that the amount households plan to save will equal the amount businesses desire to invest.
B.
the amount households plan to save is determined primarily by their wage.
C.
unemployment is caused by too little spending.
D.
increasing government spending is the most reliable method of restoring full employment.

Answer 1

[AI-generated answer — Bot]

A. the interest rate will ensure that the amount households plan to save will equal the amount businesses desire to invest.

Answer 2

[AI-generated answer — Step-by-Step Bot]

According to the classical economists, the correct answer is A. They believed that the interest rate would act as a mechanism to ensure that the amount households plan to save will equal the amount businesses desire to invest. Classical economists believed in the market's ability to self-regulate and that saving and investment decisions would be coordinated through the interest rate.