Which of the following are business cycle theories that regard fluctuations in aggregate demand as the factor that creates business cycles?
I. Keynesian cycle theory
II. real business cycle theory
III. monetarist cycle theory
A)I only
B)I and II
C)I and III
D)I, II and III
E)II and III

Question

Quizplus · Accepted Answer

Keynesian and monetarist cycle theories both consider fluctuations in aggregate demand as a key factor in creating business cycles. Real business cycle theory, however, attributes cycles to real (supply-side) shocks rather than demand fluctuations.

Which of the Following Are Business Cycle Theories That Regard