According to the real business cycle model,________ in aggregate demand ________ GDP.
A)increases; decrease
B)increases; increase
C)increases; do not affect
D)decreases; increase

Question

Quizplus · Accepted Answer

According to the real business cycle model, increases in aggregate demand do not affect GDP as it is believed that fluctuations in GDP are due to changes in productivity and technology rather than changes in aggregate demand.

According to the Real Business Cycle Model,________ in Aggregate Demand