New Keynesian Theory
A)includes microeconomic foundations and does not rely on sticky wages or prices.
B)specifies financial markets as the primary cause of business cycles.
C)relies on sticky wages and prices but does not include microeconomic foundations.
D)uses the same microeconomic foundations as other macro models.
E)specifies shocks to technology cause business cycles.

Question

Quizplus · Accepted Answer

New Keynesian Theory incorporates microeconomic foundations, such as price and wage stickiness, into macroeconomic models, similar to other macroeconomic theories.