Real Business Cycle Theory Contends That The

question 82

Multiple Choice

Real business cycle theory contends that the:

• A) aggregate supply curve is vertical, and it shifts to the left in a recession.
• B) aggregate demand curve is vertical, and it is the main factor that causes the business cycle.
• C) aggregate supply curve is horizontal, indicating that business cycles have been stabilized.
• D) aggregate demand curve is downward sloping, which shows that productivity growth is slowing down, causing the business cycle.

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Definitions:

Flowing-Water Ecosystem

A river or stream ecosystem.

River

A natural flowing watercourse, usually freshwater, flowing towards an ocean, sea, lake, or another river.

Freshwater Wetlands

Areas of land covered by fresh water for part of or all of the year, characterized by distinct plant and animal communities.

Marshes

Wetland areas often inundated with water, characterized by soft, waterlogged soil and aquatic plants.