What Did Proponents of Rational Expectations Argue About the Sacrifice

question 190

Multiple Choice

What did proponents of rational expectations argue about the sacrifice ratio and why?

• A) The sacrifice ratio would be high because it was rational for people not to immediately change their expectations.
• B) The sacrifice ratio would be high because people might adjust their expectations quickly if they found anti-inflation policy credible.
• C) The sacrifice ratio could be low because it was rational for people not to immediately change their expectations.
• D) The sacrifice ratio could be low because people might adjust their expectations quickly if they found anti-inflation policy credible.

---

Definitions:

Markers of Difference

Distinctive characteristics or attributes that are used to distinguish and categorize individuals or groups, often related to identity and social divisions.

Communicatively Constructed

A concept or reality that is created and maintained through the use of language and communication among people.

Power

The ability or capacity to influence, control, or manipulate outcomes, behaviors, or decisions, often within social, economic, or political contexts.

Passing Strategy

Techniques individuals use to present themselves as part of a different group than they actually are, often to avoid stigma or gain social acceptance.