According to Real Business Cycle Theorists

question 28

Multiple Choice

According to real business cycle theorists,

• A)fiscal policy explains most changes in output.
• B)price and wage rigidity explain most changes in output.
• C)efficiency wage theory explains wage rigidity.
• D)changes in output primarily represent changes in the natural level of output.
• E) fiscal policy explains most changes in efficiency wage theory.

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Definitions:

Surpluses

Situations in which the quantity of a good or service supplied exceeds the quantity demanded at a given price.

Migration

The movement of individuals or groups from one location to another, often for reasons such as employment, education, or economic opportunities.

Price Supports

Government interventions to maintain the price of a good or service at a certain level to encourage production and protect producers.

Producers' Income

The earnings or revenue received by the producers or firms from the sale of goods or services before the deduction of any expenses.