Question

What are the four special forms of the mainstream theory of the business cycle and how do they differ? Question content area bottom Part 1 In cycle theory, fluctuations in investment driven by fluctuations in business confidence are the main source of fluctuations in aggregate demand. In cycle theory, fluctuations in both investment and consumption expenditure, driven by fluctuations in the growth rate of the quantity of money, are the main source of fluctuations in aggregate demand. A. new classical; new Keynesian B. Keynesian; new classical C. monetarist; Keynesian D. Keynesian; monetarist Part 2 In cycle theory, the rational expectation of the price level, which is determined by potential GDP and expected aggregate demand, determines the money wage rate and the position of the SAS curve. In cycle theory, past rational expectations of the current price level influence the money wage rate and the position of the SAS curve.

          What are the four special forms of the mainstream theory of the business cycle and how do they differ?
Question content area bottom
Part 1
In ______ cycle theory, fluctuations in investment driven by fluctuations in business confidence are the main source of fluctuations in aggregate demand.
  
In ______ cycle theory, fluctuations in both investment and consumption expenditure, driven by fluctuations in the growth rate of the quantity of money, are the main source of fluctuations in aggregate demand.
  
A.
new classical; new Keynesian
B.
Keynesian; new classical
C.
monetarist; Keynesian
D.
Keynesian; monetarist
Part 2
In ______ cycle theory, the rational expectation of the price level, which is determined by potential GDP and expected aggregate demand, determines the money wage rate and the position of the SAS curve.
  
In ______ cycle theory, past rational expectations of the current price level influence the money wage rate and the position of the SAS curve.

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