If People Have Rational Expectations,then They

question 67

Multiple Choice

If people have rational expectations,then they

• A) are correct at least 50% of the time.
• B) do not make systematic and correctable errors in prediction.
• C) sometimes overestimate,but never underestimate,economic variables.
• D) revise their expectations upward when their predictions are too low and downward when they are too high.

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Definitions:

Hopelessness

A feeling of despair and the belief that there is no possibility of a positive outcome.

Cognitive Variables

Factors within cognitive psychology that influence how an individual interprets, processes, and remembers information.

Retrograde Amnesia

A loss of memory for events that occurred before the onset of amnesia, often resulting from trauma or disease.

Suicide Cluster

When two or more suicides or attempted suicides nonrandomly occur closely together in space or time.