Explanation Say’s law states that the “supply creates its own demand.” There is no over production and under production and how much the economy is produced that is automatically consumed. That means the economy is self regulating its demand and supply. The fundamental principles of classical economist is that, the economy is always experiencing the full employment situation and the economy is always capable of achieving the natural level of real GDP or output, which is the level of real GDP that is obtained when the economy's resources are fully employed. The economy operates on the production possibilities curve because the income earned will be recycled or spent on output...

Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book

20th Edition

ISBN: 9780078021756

Author: McConnell, Campbell R.; Brue, Stanley L.; Flynn Dr., Sean Masaki

Publisher: McGraw-Hill Education

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Definition Definition Curve that represents the various combinations of production possibilities of two commodities when resources or factors of production are given.

Chapter 29, Problem 8DQ

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Relation of say’s law to the classical views.

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Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book

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