Multiple Choice
Which of the following is a criticism of real business cycle theory?
A) Real business cycle theory assumes that money wage rates are sticky.
B) Real business cycle theory believes that productivity changes are caused by technology changes when in fact they are caused by changes in aggregate demand.
C) Real business cycle theory fails to explain the phenomenon of economic growth.
D) None of the above are criticisms of real business cycle theory.
Correct Answer:
Verified
Correct Answer:
Verified
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