Respuesta :
A key premise of real-business cycle theory is the notion that variables affecting aggregate supply, rather than aggregate demand, are principally responsible for economic variations.
What stand out aspects of genuine business cycle theory?
Economic expansion, recession, trough, and recovery all occur within business cycles. The length of these phases can change from situation to situation. The core premise of real business cycle theory is that various business cycle phases in an economy are brought on by shocks to technology.
Wage and price flexibility: The real business cycle theory makes the supposition that pricing and wages are negotiable. To clear the marketplace, they make swift adjustments. No flaws in the market exist. The "invisible hand" is what clears the market and ensures the best possible distribution of resources throughout the economy.
What are some of the biggest objections to the actual business cycle?
First, the RBC theory places more emphasis on supply-side factors than demand-side factors. The RBC theory also makes the assumption that output is always at its natural level. Stickiness in wages and prices is not accounted for by the theory.
Learn more about real-business cycle theory: https://brainly.com/question/19865373
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