Economic Theories of Business Cycles Quiz

Test your knowledge of economic theories explaining business cycles. Questions cover classical, Keynesian, Austrian, monetarist, and other theories.

#1

Which economist is associated with the concept of the 'invisible hand' and the idea that markets are self-regulating?

John Maynard Keynes
Milton Friedman
Adam Smith
Karl Marx
#2

Which economic theory suggests that business cycles are caused by changes in technological progress and innovation?

Keynesian economics
Monetarist theory
Real business cycle theory
Austrian economics
#3

According to the classical theory of business cycles, what is the primary cause of economic fluctuations?

Government intervention
Changes in technology
Fluctuations in consumer spending
Monetary policy
#4

Which economic theory emphasizes the role of monetary policy in influencing business cycles and argues that changes in the money supply have a significant impact on economic fluctuations?

Classical economics
Monetarist theory
Keynesian economics
New Keynesian economics
#5

In the context of business cycles, what is 'stagflation' characterized by?

High inflation and high unemployment
Low inflation and low unemployment
High inflation and low unemployment
Low inflation and high unemployment
#6

What is the primary focus of New Keynesian economics in explaining business cycles?

Technological progress
Monetary policy
Supply-side shocks
Consumer behavior
#7

According to monetarist theory, what is the primary driver of business cycles?

Changes in technology
Fluctuations in consumer spending
Changes in the money supply
Government intervention
#8

Which economist is known for the idea that 'animal spirits' influence economic decision-making and contribute to business cycles?

John Maynard Keynes
Milton Friedman
Friedrich Hayek
Irving Fisher
#9

Which economist is known for the theory that business cycles are primarily driven by changes in aggregate demand, and advocated for government intervention to stabilize the economy?

Milton Friedman
John Maynard Keynes
Friedrich Hayek
Irving Fisher
#10

In the context of business cycles, what is the 'Phillips curve' primarily associated with?

Inflation and unemployment
Interest rates and investment
Income distribution
Productivity and output
#11

According to the Austrian business cycle theory, what is the main driver of business cycles?

Government intervention
Fluctuations in consumer spending
Changes in interest rates
Technological progress
#12

Which economic theory suggests that business cycles are a result of self-adjusting markets and that government intervention only exacerbates the problem?

Monetarist theory
Keynesian economics
Real business cycle theory
Austrian economics
#13

Which economic theory suggests that business cycles are mainly caused by external shocks to the economy, such as changes in oil prices or technological advancements?

Keynesian economics
Monetarist theory
Real business cycle theory
Austrian economics
#14

In the context of business cycles, what is 'creative destruction' associated with?

Innovation and economic growth
Recession and unemployment
Government intervention
Market equilibrium
#15

According to Real Business Cycle (RBC) theory, what is the primary driver of economic fluctuations?

Changes in interest rates
Technological shocks
Monetary policy
Fiscal policy

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