How do adherents of traditional business cycle theories differ from real business cycle theorists? List the difference between their views on the role of government
Economists associated with traditional business cycle theories see cycles as a problem, while real business
cycle theorists see cycles as a natural, anticipated, and positive outcome of technological change and
increased productivity. Economists associated with traditional business cycle theories see government as an
instrument to correct the problems associated with business cycles, while real business cycle theorists see
government as a long-run growth obstructionist.
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What are the reasons that are usually given to justify regulation?
What will be an ideal response?
Any business wanting to attract financial capital must expect to
A) earn a positive economic profit. B) keep implicit costs as close to zero as possible. C) pay a normal rate of return. D) pay a below normal rate of return in order to make a positive rate of return itself.
Scott used $4,000,00 . from his savings account that paid an annual interest of 5% to purchase a hardware store. After one year, Scott sold the business for $4,100,000 . An Economist calculated his profit to be:
a. $300,000 b. $100,000 c. -$100,000 d. -$200,000
Resources are scarce
a. because there is always a greater demand for them than there is a supply of them b. only if the resources are nonrenewable c. only if the resources are renewable d. because all resources are nonrenewable e. because all resources are renewable