The theory that real shocks to the economy are the primary cause of business cycles is

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22 February, 12:52

The theory that real shocks to the economy are the primary cause of business cycles is

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Kaya Kline · Answer 1

It would be the real-business-cycle theory which is the principle that mainly revolves around the idea that the macroeconomic models are one of the significant factors that are responsible for the occurrence of economic shocks. In addition, the theory is also called the RBC theory.