An Unexpected Decrease in Aggregate Demand Will Trigger a Recession

question 18

Multiple Choice

An unexpected decrease in aggregate demand will trigger a recession in the ________ theory of the business cycle.

• A) new Keynesian cycle
• B) new classical cycle
• C) Keynesian cycle
• D) Both answers A and B are correct.

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Definitions:

Stolon

Stem that grows horizontally along the ground and may give rise to new plants where it contacts the soil—e.g., the runners of a strawberry plant.

Bulb

An underground storage organ formed from swollen plant parts, containing nutrient reserves to support the plant's next cycle of growth.

Rhizome

Rootlike underground stem.

Corm

A rounded underground storage organ consisting of swollen stem tissue, covered with scaly leaves, found in some plants serving for food storage and to survive winter or dry months.