• Card 33 / 145: The Real Business Cycle (RBC) model implies that
    A) the rate of inflation is closely linked to the real rate of output growth.
    B) real output will always fluctuate around the aggregate demand curve.
    C) business cycles are the result of fluctuations in the money supply.
    D) business cycles are driven by real shocks to the economy.

    Answer:
    D) business cycles are driven by real shocks to the economy.

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Macroeconomics MCQ

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