Final answer:
An economy in recession can return to full employment in the long run without aggressive intervention; however, expansionary policies can aid in this process. There is often a delay before private sector firms expand their workforce post-recession, and neoclassical economists believe the economy self-corrects over time.
Step-by-step explanation:
The statement 'an economy in recession can return to full employment in the long run through' is true. An economy in recession can indeed return to full employment in the long run. While expansionary fiscal and monetary policies are important tools in stimulating an economy during a recession, they are not immediate fixes.
After a recession, even when positive growth has returned, there can be a delay before private-sector firms feel confident enough in the economic climate to expand their workforce.
Looking at historical data, such as that since 1960 in the U.S., we can see that actual GDP does have short-term fluctuations, but the long-term trend typically follows the potential GDP as estimated by entities like the Congressional Budget Office. Over time, an economy tends to self-correct towards full employment.
Neoclassical economists may be hesitant to advocate for aggressive policies to stimulate aggregate demand because they believe that the economy, in the long run, is capable of adjusting on its own to achieve full employment.