Real Business Cycle Theorists Are Critical of Monetarist Reduced-Form Evidence

question 22

Multiple Choice

Real business cycle theorists are critical of monetarist reduced-form evidence because they believe

• A)money is the most important cause of changes in aggregate demand.
• B)there is reverse causation from the business cycle to money.
• C)there is reverse causation from money to the business cycle.
• D)business cycles do not exist.

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Definitions:

Sarbanes-Oxley Act

A U.S. law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to securities laws.

Sole Proprietorships

A rephrasing of proprietorship; a business structure where a single individual owns and runs the business, bearing all profits and responsibilities.

Internal Controls

The policies and procedures used to safeguard assets, ensure accurate business information, and ensure compliance with laws and regulations.

Petty Cash

A small amount of cash on hand used for minor or incidental expenses.