Assume That Your Economics Professor Announces to Your Class That

question 45

Essay

Assume that your economics professor announces to your class that after thirty years of giving exams only on scheduled dates, this semester she will give only surprise quizzes. What is the rational expectation response to this new policy? Why does your self-interest require that you change your behavior? What would the consequences be for students who changed their expectations about exams adaptively?

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Definitions:

Ampulla

An enlargement or dilatation in a canal or duct, commonly referring to the dilated end of ducts such as the bile duct.

Utricle

A part of the inner ear's vestibular system, responsible for detecting linear accelerations and head position changes.

Vestibule

An entryway or small room between the outer door and the interior of a building, or an anatomical space within the body, especially within the ear or nose.

Inner Ear

The innermost part of the ear, containing the cochlea, vestibule, and semicircular canals, crucial for hearing and balance.