Which of the following is an assumption of Hick's Theory of Business Cycles?
(a) In an economy where the realized growth rate (Gr) and natural growth rate (Gn) are equal, it indicates that the economy is operating at its equilibrium rate of growth.
(b) The consumption function of the model should be Ct = α Yt-1 as proposed by Samuelson.
(c) The autonomous investment is a function of output at present.
(d) Within the model, the terms "ceiling" and "bottom" are employed to elucidate the ascending and descending movement of business cycles, respectively.
1
Both (b) and (d)
2
Both (a) and (b)
3
All (a), (c) and (d)
4
All of the above