Which theory assumes that business cycles occur because of changes in business confidence?
A) real business cycle theory
B) monetarist cycle theory
C) Keynesian cycle theory
D) new classical cycle theory

Question

Quizplus · Accepted Answer

Keynesian cycle theory assumes that business cycles occur due to changes in business confidence. This theory emphasizes the role of psychological factors and animal spirits in driving economic fluctuations.

Which Theory Assumes That Business Cycles Occur Because of Changes