In the monetarist business cycle theory, the factor leading to a business cycle is changes in
A) consumer spending.
B) investment spending.
C) the growth rate of the quantity of money.
D) net exports.

Question

Quizplus · Accepted Answer

Monetarist business cycle theory, primarily associated with Milton Friedman, posits that fluctuations in the money supply are the main cause of economic cycles. Changes in the growth rate of the quantity of money can lead to periods of expansion or contraction in the economy.

In the Monetarist Business Cycle Theory, the Factor Leading to a Business