Real business cycle theory says that the factor leading to the business cycle is represented by changes in
A) animal spirits.
B) the growth rate of the quantity of money.
C) only aggregate demand.
D) productivity.

Question

Quizplus · Accepted Answer

Real business cycle theory attributes fluctuations in the business cycle to changes in productivity, such as technological innovations or changes in the availability of resources, rather than to changes in monetary policy or demand.

Real Business Cycle Theory Says That the Factor Leading to the Business