Question

What is classical economics?

A) the idea that government spending and tax cuts help an economy
B) the idea that free markets can regulate themselves
C) the idea that every one dollar of government spending creates more than one dollar in economic activity
D) a form of demand-side economics that encourages government action to increase or decrease demand and output

Answer 1

I would say B because classical economics is also known as liberal economics and that means that markets function best with minimal government interference.

Answer 2

The correct answer is B. Classical economics is the idea that free markets can regulate themselves.

Step-by-step explanation:

Classical economics is an economic school that emerged in the eighteenth century and was the dominant trend within economic science for much of the nineteenth century.

With the rise of classical economics, economy became an independent scientific area for the first time. The ideas of the classics are largely in line with economic liberalism and are based on the ability of free markets to regulate themselves.

The precise definition of the traditional economy is not certain, but Adam Smith and David Ricardo are usually its most important representatives.