ECONOMICS
BUSINESS CYCLES
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
the desirable monetary policy would appear to be one that results in a slow steady growth in the money supply and, thus, stable prices.
|
|
|
there is some role for activist monetary stabilization policy of a Keynesian type.
|
|
|
changes in aggregate demand cannot impact output.
|
|
|
Both a and b
|
|
|
Both a and c
|
Detailed explanation-1: -Detailed Solution The correct answer is Both a and b. Business cycle: It is the upward and downward movements of levels of GDP (gross domestic product) and refers to the period of expansions and contractions in the level of economic activities (business fluctuations) around a long-term growth trend.
Detailed explanation-2: -Real business cycle theory is the latest incarnation of the classical view of economic fluctuations. It assumes that there are large random fluctuations in the rate of technological change. In response to these fluctuations, individuals rationally alter their levels of labor supply and consumption.
Detailed explanation-3: -Key Takeaways The business cycle goes through four major phases: expansion, peak, contraction, and trough. All economies go through this cycle, though the length and intensity of each phase varies.
Detailed explanation-4: -Which one of the following is not correct about business cycle? a)They occur simultaneously in all industries and sectorsb)They affect not only output level but also other related variablesc)They are international in characterd)None of the aboveCorrect answer is option ‘D’.