Real Business Cycle Theory

question 12

Multiple Choice

Real business cycle theory:

• A) emphasizes only changes in tax rates.
• B) argues that shifts in consumption spending are responsible for fluctuations in output.
• C) ignores the effects of shocks to the production technology.
• D) argues that fluctuations in output are caused by technological change.

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Definitions:

Unconscious Mind

A part of the mind that is inaccessible to the conscious mind but that affects behavior and emotions.

Conscious Mind

The aspect of the mind that involves awareness of the self, the environment, and one's thoughts and experiences.

Latency Stage

A phase in Freud's psychosexual development theory occurring in childhood, where sexual urges are repressed, allowing for focus on social and intellectual growth.

Formal Education

The structured, systematic instruction and training provided by schools and institutions, leading to recognized qualifications.