According to Real Business Cycle Theory,the Primary Causes of Business

question 29

Multiple Choice

According to real business cycle theory,the primary causes of business cycles are

• A) shocks to aggregate demand.
• B) monetary factors.
• C) waves of self-fulfilling optimism and pessimism.
• D) fiscal shocks.
• E) technology shocks.

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Definitions:

Utility Function

A mathematical representation in economics that describes how different goods or bundles of goods satisfy a consumer's needs and preferences.

Budget Constraint

An economic model representing all the combinations of goods and services a consumer can afford, given their income and the prices of goods.

Income

The financial gain or money received by an individual or household from various sources like work, investments, or transfers, over a period of time.

Apples

A popular fruit known for its variety and nutritional value often used in culinary dishes and beverages.