Because classical economists stressed the long run, what did they believe about the economy?

• A. Viewed the economy as mostly self-adjusting.
• B. Favored the use of monetary policy over fiscal policy.
• C. Favored the use of fiscal policy over monetary policy.
• D. Expected the government to purge the rot from the system.

Answer: (C)

In classical economics, the emphasis on the long run means markets are seen as self-correcting. With flexible wages and prices, supply and demand adjust to shocks and output returns to its natural level, so unemployment is temporary. Because the economy tends toward full employment on its own, there’s little need for government stabilization—hence the view that the economy is mostly self-adjusting.

That’s why the statement that best fits is that they viewed the economy as mostly self-adjusting. The other ideas conflict with the classical stance: they didn’t rely on active fiscal or monetary policy to steer real output in the long run, and they didn’t advocate a government-driven purge of “rot” from the system.