Which of the Following Statements Is True About Causes of Business

question 21

Multiple Choice

Which of the following statements is true about causes of business cycle fluctuations?

• A)Economists all agree that supply shocks are the cause of most business cycle fluctuations.
• B)Economists all agree that productivity shocks are the cause of most business cycle changes.
• C)Economists all agree that monetary changes are primarily responsible for business cycle fluctuations.
• D)There are a wide range of theories as to the underlying causes of business cycle movements.

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Definitions:

Efficient Scale

The level of production at which a firm achieves the lowest long-run average cost, with all inputs utilized most effectively.

Surplus

A situation where the quantity supplied of a good or service exceeds the quantity demanded at the current price, often leading to a decrease in prices.

Balance of Trade

The difference in value between a country's imports and exports over a certain period.

Money Inflows

Money inflows refer to the incoming funds to a business, organization, or economy from various sources such as investments, sales, and loans.