Macroeconomics

‭●‬ ‭The‬ ‭idea‬ ‭of‬ ‭self-correction‬ ‭is‬ ‭not‬ ‭universally‬ ‭accepted‬ ‭,‬‭and‬‭some‬‭economists‬‭argue‬‭that‬‭the‬ ‭adjustment‬ ‭process‬ ‭can‬ ‭be‬ ‭lengthy‬ ‭and‬ ‭may‬ ‭not‬‭always‬‭lead‬‭to‬‭full‬‭employment,‬‭especially‬‭in‬ ‭the presence of severe economic shocks.‬ ‭●‬ ‭In‬‭practice,‬‭government‬‭interventions,‬‭such‬‭as‬‭monetary‬‭and‬‭fscal‬‭policies,‬‭are‬‭often‬‭employed‬ ‭to‬‭stabilize‬‭economies‬‭and‬‭minimize‬‭the‬‭negative‬‭impacts‬‭of‬‭demand‬‭shocks.‬‭These‬‭policies‬‭can‬ ‭complement‬ ‭the‬ ‭self-adjustment‬ ‭process‬ ‭to‬ ‭achieve‬ ‭economic‬ ‭stability‬ ‭more‬ ‭effciently‬ ‭(economic policies will be discussed in Chapter 5).‬

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