If the Public Has Rational Expectations

question 89

Multiple Choice

If the public has rational expectations,

• A) the only effective policy would be one that is implemented by surprise.
• B) if the public incorrectly anticipates a given policy,there could be adverse results.
• C) if policymakers do not do what they say they are going to do,then there could be adverse results.
• D) a,b,and c
• E) none of the above

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Definitions:

Economic Disaster

A situation where there's a severe disruption of the economy of a country or region, often caused by financial crisis, natural disasters, or extreme political instability.

Managerial Disaster

A significantly adverse event resulting from poor management decisions, which can lead to financial loss, reputational damage, or operational dysfunction.

Environmental Disaster

A significant event caused by human activity or natural processes leading to severe negative impacts on the environment.

Technological Disaster

An event caused by a malfunction, failure, or misuse of technology, leading to significant harm to people, property, or the environment.