According to Rational Expectations Theory, What Information Do Businesses and Workers

question 54

Multiple Choice

According to rational expectations theory, what information do businesses and workers use when they form their expectations regarding inflation?

• A)Recent events and data.
• B)Keynesian and monetarist models.
• C)Forecasts by public-and private-sector economists.
• D)All the relevant information that is available.

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Definitions:

Inconsistencies

Describes situations where there is a lack of alignment or congruence between elements or behaviors within an organization.

Project

A planned set of interrelated tasks to be executed over a fixed period and within certain cost and other limitations.

Cheerfulness

A state of being noticeably happy and optimistic.

Contentment

A state of happiness and satisfaction.