Which of the following are business cycle theories that regard fluctuations in aggregate demand as the factor that is creating business cycles?
I. Keynesian cycle theory
II. real business cycle theory
III. monetarist cycle theory
A) I only
B) I and II
C) I and III
D) I, II and III

Question

Quizplus · Accepted Answer

Keynesian cycle theory and monetarist cycle theory both view fluctuations in aggregate demand as the primary cause of business cycles. Real business cycle theory, on the other hand, attributes business cycles to real shocks to the economy, such as changes in technology or resource availability, rather than to changes in aggregate demand.

Which of the Following Are Business Cycle Theories That Regard