Explain in detail how real business cycle theory is different from the rational expectaion theories of business cycle.?

Q: The new Keynesian cycle theory views only anticipated changes in aggregate demand as the source of…

A: The above statement is true. According to the new Keynesian cycle theory firms and households have…

Q: What are some problems with Keynesian business cycle theory? A. It does not predict stagflation B.…

A: According to Keynes, the vacillations in the marginal efficiency of capital lead to the business…

Q: real business cycle models (RBC) are preferable to traditional Keynesian macroeconomic models.

A: real business cycle models (RBC) are preferable to traditional Keynesian macroeconomic models. -…

Q: What are some arguments and implications as it relates to Business Cycles in Emerging Economies ?…

A: A business cycle is basically defined by the alternation of stages of expansion and contraction of…

Q: Explain it correctly not copy paste Q)In the Real Business Cycle model, what is the effective…

A: Effective investment refers to the net addition to the capital stock of economy which is measured by…

Q: c. d. A key question in macroeconomics is why the economy experiences business cycle fluctuati…

A: The ups and downs in the economy of the country is a result of business cycle.

Q: Show the effects of a decrease in current period productivity in the Keynesian model? Why does the…

A: Keynesian Theory of Employment and Output: Keynesian Theory of employment and output determination…

Q: Which of te following does not contribute to the real business cycle explanation of business cycle?…

A: Real business cycle theory doesn't incorporate aggregate supply.

Q: TRUE/FALSE. Brietly explain your answer. a) The real business cycle model is very helptul because we…

A: Monetary policy is a bunch of activities that can be embraced by a country's central bank to control…

Q: Cite at least two (2) real life scenario based on the concept of Neo-Classical Theory. Give Emphasis…

A: A Neoclassical Economic Theory states that a product or service is valued above or below its…

Q: A key difference between the new classical and the new Keynesian views of the business cycle is the…

A: There are four economic theories mainly New classical economics, Keynesian economics, supply side…

Q: What is deflation, and what problems does deflation pose for the macroeconomy? How does deflation…

A: Inflation happens as the rates of products and services increase; however, deflation happens when…

Q: 4. In the real business cycle model, suppose a war or natural disaster destroys some of the:…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: Regardless of many assumptions, an equilibrium business-cycle model can go a long way in matching…

A: Business-cycle: It refers to the conditions under which the growth and decline have been taken into…

Q: One criticism of the real business of the real business cycle theory is that the intertemoptal…

A: Genuine business-cycle theory expects that the market is going through varieties in its capacity to…

Q: An important critique of real business cycle theory is that during a recession A. there is…

A: This hypothesis frequently clarifies recession as times of technology relapse. As per this…

Q: Which of the following are business cycle theories that regard fluctuations in aggregate demand as…

A: The business cycle refers to the fluctuations in the economy which are periodic and occur…

Q: Q) Show the effects of a decrease in current period productivity in the Keynesian model? Why does…

A: In the Keynesian economic model, the intersection of aggregate demand and supply will determine the…

Q: Keynesian business cycle theory suggests that government intervention in markets may create…

A: The theory that depicts the decline and growth of a nation of an economy that is being measured…

Q: If most people have rational expectations, how long will recessions last? Explain using your…

A: The rational expectations results in the assumption of the new Keynesian school of economics which…

Q: What is the Classical Dichotomy, and how is it explained with AS and AD diagram and concepts?

A: Classical Dichotomy is explained as when the changes in the quantity of money occurs, it only…

Q: Suppose you are interested in isolating the cyclical component of a macroeconomic time series (such…

A: The time series viewpoint—cycles being dictated by different arbitrary shocks which are proliferated…

Q: Calculate expected after tax real interest rate in following two scenarios ScenarioNominal Interest…

A: The real interest rate is the rate that is adjusted to reduce or remove the inflation effect so that…

Q: Compare Hicks theory of business cycle and Keynesian theory of business cycle.

A: The business cycle is the irregular and nonrepeating up and-down movement of business activity. The…

Q: Is fiscal policy, say an increase in government expenditures (G), effective according to the Real…

A: Real Business Cycle Theory states that business cycle phases recession, depression, recovery are…

Q: as you analyze the dismal United States economic environment, you notice that unemploymentis…

A: All the countries goes through changes and fluctuations in the economic activities. Sometimes, the…

Q: What are the key ideas of the real business cycle model? How does it explain business cycle…

A: The real business cycle theory makes the fundamental assumption that an economy witnesses all these…

Q: Explain how the real business cycle model can explain why the price level is countercyclical at some…

A: Economics as a subject deals with the allocation of scarce resources among humans with unlimited…

Q: How do Classical economists and Keynesian economists differ in their perceptions of how well markets…

A: Since you have posted multiple questions, we will solve first question for you if you want other…

Q: The purpose is to know if you can define each concept through a clear and precise explanation.…

A: 1. deficit The deficit can be understood as a shortage or lack of something because the cost is…

Q: Describe the four phases of the classical business cycle   explaining how employment is typically…

A: A business cycle is a wave-like fluctuation in the economy and the wave-like fluctuation will have…

Q: What types of shocks are thought to cause most of the fluctuations that are called business cycles…

A: The new Keynesian models would result in the much later school of thought which explained the…

Q: Describe in detail-The 2 components of the classical model of employment

A: In an economy, classical economics focused on the general behavior of a market and the stabilizing…

Q: Describe the behavior of consumption, investment, labor, productivity, wages, the price level and…

A: The two extreme phases of the business cycle and its impact is as follows:1.BoomDuring this phase,…

Q: real business cycle theory suggest that _______ not important in explaining short-term fluctuations…

A: The Real business cycle theory states that the fluctuations in the economy are largely explained by…

Demand and Supply

The concept of demand and supply is important for various factors. One of them is studying and evaluating the condition of an economy within a certain period. The analysis or evaluation of the demand-side factors is important for the suppliers to understand the consumer or individual behaviour. The evaluation of supply-side factors is important for the consumer or individuals to understand that what kind of combination of an economic good or what kind of economic good and services he or she should consume to maximise his utility and minimise the cost. Therefore, in microeconomics, both of these concepts are extremely important to have an idea that what exactly is going on in the economy.