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The view that the trade cycle is a purely monetary phenomenon driven by unplanned changes in the money supply is associated in the chapter with:
APigou
BSchumpeter
CHawtrey
DKeynes
Answer & Solution
Correct answer: C. Hawtrey
1. The chapter states that, according to Hawtrey, the trade cycle is a purely monetary phenomenon.
2. Unplanned changes in money supply cause the fluctuation.
3. So the correct choice is Hawtrey.
4. Pigou (psychological optimism/pessimism), Schumpeter (innovations), and Keynes (effective demand) are ruled out.
_Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 5 "Business Cycles", p.8_
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