Which Theory Distinguishes Between Expected and Unexpected Fluctuations in Aggregate

question 155

Multiple Choice

Which theory distinguishes between expected and unexpected fluctuations in aggregate demand and asserts that only unexpected changes can affect real GDP?

• A) Keynesian cycle theory
• B) real business cycle theory
• C) monetarist cycle theory
• D) new classical cycle theory

---

Definitions:

Sucker Effect

A reduction in effort by members of a group based on the perception that others are not making their fair share of effort.

Withhold Effort

Deliberately not giving one's full effort or capability, often in a work context.

Low Cohesiveness

Refers to a lack of unity, solidarity, or agreement among members within a group, which can negatively affect its performance or stability.

Low Conformity

The tendency of an individual or group to resist adhering to the norms or standards of a larger community or society.