Which of the following statements is (are)correct?

Question

Quizplus · Accepted Answer

Real business cycle theory posits that business cycles are largely due to real (in contrast to nominal) shocks and that individuals and firms make optimizing decisions in response to these shocks. This perspective views the business cycle as an equilibrium process, not requiring government intervention to mitigate fluctuations, as agents' responses to real shocks are seen as optimal adjustments. Thus, all the statements A, B, and C accurately describe aspects of real business cycle theory, making E (all of the above) the correct answer.

Which of the Following Statements Is (Are)correct