All of the following is consistent with the classical theory of employment EXCEPT

A) The interest rate will equalize savings and investment.
B) Everything produced will necessarily be purchased.
C) Saving and investing are done by different people for different reasons.
D) Wages and prices are flexible downwards.

Classical Theory

Refers to an economic theory that asserts that the economy is self-regulating, markets are best left alone without government intervention, and supply creates its own demand.

Interest Rate

The fee that a lender imposes on a borrower for the usage of assets, represented as a proportion of the principal amount.

Savings And Investment

The act of setting aside income for future use and the use of those savings for new capital expenditures or financial products.