After Experiencing About 4 Percent Inflation the Last 10 Years

question 57

Multiple Choice

After experiencing about 4 percent inflation the last 10 years, Americans start to believe that the inflation for this year is also 4 percent. This belief regarding the future path of inflation based on previous inflation is called:

• A) intuitions of inflation.
• B) expectations of inflation.
• C) rational expectations.
• D) a self fulfilling prophecy.

---

Definitions:

Personal Liability

Personal liability means an individual's legal responsibility to fulfill debts or obligations, which can extend to their personal assets.

Non-existent Corporation

A corporation that either has not been legally established or has been dissolved, thereby lacking legal recognition.

Undisclosed Principal

A situation in a contract where the existence and identity of one party are not revealed to the other party.

Liability

Legal responsibility for one's actions or omissions, which may result in being obligated to offer compensation for harm caused.