Real Business Cycle Theory Contends That The

Multiple Choice

Real business cycle theory contends that the:

A) aggregate supply curve is vertical, and it shifts to the left in a recession.
B) aggregate demand curve is vertical, and it is the main factor that causes the business cycle.
C) aggregate supply curve is horizontal, indicating that business cycles have been stabilized.
D) aggregate demand curve is downward sloping, which shows that productivity growth is slowing down, causing the business cycle.