A Key Element of the New Classical Model of the Business

question 315

Multiple Choice

A key element of the new classical model of the business cycle is

• A) sticky prices.
• B) rational expectations.
• C) a horizontal SAS curve.
• D) random fluctuations in technology.

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Definitions:

Purchase Price

The amount of money paid or to be paid by the buyer to acquire ownership of a good, service, or property.

Federal Law

Legislation enacted by the national government of a country; in the United States, laws passed by Congress and signed by the President.

State Law

Laws and regulations enacted by individual states, distinct from federal laws, governing within their territories.

Nonnegotiable

Refers to instruments or contracts that cannot be transferred or assigned from one party to another in a legally binding manner.