According to the real business cycle theory, an adverse change in technology:

Question

Quizplus · Accepted Answer

According to the real business cycle theory, an adverse change in technology leads to a decrease in productivity and potential output. This decrease in productivity causes a reduction in real wages and output, as firms hire fewer workers and produce a lower quantity of goods and services. Therefore, the best choice is C, which indicates that a decrease in productivity causes real wages to fall and output to decline.

According to the Real Business Cycle Theory, an Adverse Change