An example of an exogenous business cycle theory would be the __________ theory.

Question

Quizplus · Accepted Answer

The demand shock theory suggests that business cycles are caused by sudden shifts in the demand for goods and services due to exogenous factors such as changes in consumer behavior, technological developments, or political events. These shocks can lead to either a boom or a recession in the economy, depending on whether the demand increases or decreases. Therefore, it is an example of an exogenous business cycle theory.

An Example of an Exogenous Business Cycle Theory Would Be