Question :
22) A theory of aggregate economic fluctuations called real business : 1373916
22) A theory of aggregate economic fluctuations called real business cycle theory holds that
A) changes in the real money supply are the only demand shocks that affect the natural rate of output.
B) aggregate demand shocks do affect the natural rate of output.
C) aggregate supply shocks do affect the natural rate of output.
D) changes in net exports are the only demand shocks that affect the natural rate of output.
23) This theory views shocks to tastes (workers’ willingness to work, for example) and technology (productivity) as the major driving forces behind short-run fluctuations in the business cycle because these shocks lead to substantial short-run fluctuations in the natural rate of output.
A) The natural rate hypothesis
B) Hysteresis
C) Real business cycle theory
D) The Phillips curve model
24) Because shifts in aggregate demand are not viewed as being particularly important to aggregate output fluctuations, they do not see much need for activist policy to eliminate high unemployment. “They” refers to proponents of
A) the natural rate hypothesis.
B) monetarism.
C) the Phillips curve model.
D) real business cycle theory.
25) A group of economists believe that the natural rate of output is affected by aggregate ________ shocks. They contend that the natural rate level of unemployment and output are subject to ________, a departure from full employment levels as a result of past high unemployment.
A) supply; hysterisis
B) supply; systerisis
C) demand; hysterisis
D) demand; systerisis
26) A reduction of aggregate demand may raise the natural rate of unemployment above the full employment level, meaning that the self-correcting mechanism will only be able to return the economy to the natural rate level of output and unemployment?not to the full employment levels. Such a view is consistent with
A) monetarism.
B) hysterisis.
C) Keynesianism.
D) real business cycle theory.
27) According to aggregate demand and supply analysis, America’s involvement in the Vietnam War had the effect of
A) increasing aggregate output, lowering unemployment, and raising the price level.
B) decreasing aggregate output, lowering unemployment, and lowering the price level.
C) increasing aggregate output, raising unemployment, and raising the price level.
D) decreasing aggregate output, raising unemployment, and lowering the price level.
28) According to aggregate demand and supply analysis, the negative supply shocks of 1973-1975 and 1978-1980 had the effect of
A) increasing aggregate output, lowering unemployment, and raising the price level.
B) decreasing aggregate output, raising unemployment, and raising the price level.
C) increasing aggregate output, raising unemployment, and raising the price level.
D) decreasing aggregate output, raising unemployment, and lowering the price level.
29) According to aggregate demand and supply analysis, the favorable supply shock of 1995-1999 had the effect of
A) increasing aggregate output, lowering unemployment, and raising inflation.
B) decreasing aggregate output, raising unemployment, and raising inflation.
C) increasing aggregate output, lowering unemployment, and lowering inflation.
D) decreasing aggregate output, raising unemployment, and lowering inflation.
30) According to aggregate demand and supply analysis, the negative demand shock of 2000-2004 had the effect of
A) increasing aggregate output, lowering unemployment, and raising inflation.
B) decreasing aggregate output, raising unemployment, and raising inflation.
C) increasing aggregate output, lowering unemployment, and lowering inflation.
D) decreasing aggregate output, raising unemployment, and lowering inflation.
