Classical economists believe that supply creates demand

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Classical economists believe that supply creates demand—that the production of goods generates demand. People working and making salaries spend their money on goods. The production of goods (supply) creates purchases (demand). Keynesian economists believe that the economy works the other way around—that increasing demand increases supply. Producers increase their supply in order to meet an increase in demand.

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Which of the two views of the economy is correct? Does supply create demand or does demand create supply?

Reference no: EM131159507

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