A) direct relationship between aggregate supply and aggregate demand.
B) real-business-cycle view of recession.
C) monetarist view of recession.
D) mainstream, Keynesian-based view of recession.

Question

A) direct relationship between aggregate supply and aggregate demand. 
B) real-business-cycle view of recession. 
C) monetarist view of recession. 
D) mainstream, Keynesian-based view of recession.

Quizplus · Accepted Answer

The real-business-cycle view of recession suggests that business cycles arise due to exogenous shocks to the economy, such as technological advances or changes in resource availability, that cause fluctuations in the level of economic activity. This view emphasizes the role of aggregate supply in driving fluctuations, rather than changes in aggregate demand, which is the focus of the Keynesian-based view of recession. The monetarist view also emphasizes the role of changes in the money supply in driving business cycles, which is not mentioned in the given information.

A) Direct Relationship Between Aggregate Supply and Aggregate Demand