Question

In the Austrian View of the Business Cycle, a genuine increase in economic growth must be supported by an increase in

Select one:

a. The money supply.

b. Government spending.

c. Consumption.

d. Saving.

Answer 1

Option A.

• In the Austrian view of the business cycle, a genuine increase in economic growth must be supported by an increase in money supply.
• The Austrian business cycle theory is an economic theory that describes how business cycles occur in the economy.
• According to this theory the business cycle undergoes expansion when the money supply increases.
• This expands the reserves in the economy and banks have more to lend.
• This will automatically lead to an increase in economic growth.

answered by: anonymous