According to the Real Business Cycle Theory, Which of the Following

question 74

Multiple Choice

According to the real business cycle theory, which of the following would be a real disturbance to the economy?

• A) change in the required reserve ratio
• B) reduction in the money supply
• C) increase in the labor force
• D) increase in the price level

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Definitions:

Subducted Plate

The portion of a tectonic plate that is forced below another plate into the Earth's mantle at a convergent boundary.

Oceanic Crust

The portion of the Earth's crust that underlies the ocean basins, composed predominantly of basalt and gabbro.

Lavas

Magma that has been expelled from a volcanic vent and has solidified on the Earth's surface.

Magmas

Molten rock material beneath or within the Earth's crust, from which igneous rock is formed through cooling and solidification.