According to the Real Business Cycle Theory, Technological Change

question 361

Multiple Choice

According to the real business cycle theory, technological change

• A) always increases productivity.
• B) never increases productivity.
• C) can initially decrease productivity.
• D) is caused by changes in productivity.

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Definitions:

Common Stock

Common stock is a type of security that represents ownership in a corporation, granting holders voting rights and a share in the company's profits through dividends.

ROE

Return on Equity, a measure of financial performance calculated by dividing net income by shareholders' equity, indicating how effectively management is using a company’s assets to create profits.

Net Income

The final income of a business once expenses and taxes are removed from the total revenue.

Invested Capital

Total capital invested in a company by its shareholders and debt holders, used for calculating returns generated by a company.