Critics of the Real Business Cycle Theory Claim That

question 172

Multiple Choice

Critics of the real business cycle theory claim that

• A) changes in technology cannot cause economic growth.
• B) the intertemporal substitution effect is too weak to account for changes in labor supply.
• C) both real and nominal variables change during the business cycle.
• D) Both answers B and C are correct.

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Definitions:

Unanimous Agreement

An agreement or decision made with the approval of all parties involved, indicating total consensus without any dissent.

Disclosure

The act of making new or significant information known, particularly in legal and corporate contexts, where transparency is required by law or policy.

Principal

The main party to a transaction, obligation, or financial instrument, in contrast to an agent or intermediary.

Third Party

An individual or group besides the two primarily involved in a transaction or legal case.