In the long run, adjustments to negative or positive shocks to the economy works through the self-correcting mechanism of markets.

a) if wages and prices are flexible (i. e., can go down or up)

b) if government keep its fiscal house in order by having a balanced budget

c) If government avoid any intervention in the economy and have a budget surplus

d) if government uses stabilization polices to help the economy out of its downturns or upturns.