According to Rational Expectations Theory

question 39

Multiple Choice

According to rational expectations theory,

• A)there is absolutely nothing government can do, even in the short run, to reduce the economy's unemployment rate.
• B)the government can use fiscal policy such as increased government spending or lower tax rates to reduce unemployment.
• C)a modern extension of Keynesian economics exists.
• D)discretionary fiscal policy is essential for prolonged growth.
• E)market participants can be fooled in the long run by monetary and fiscal policy rules.

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Definitions:

Air System

The network within a vehicle or machine that manages the distribution and flow of air, important for various functions including braking and engine operation.

Adjustment

The process or action of altering or modifying something to achieve a desired fit, function, or accuracy.

FMVSS-121

Federal Motor Vehicle Safety Standard No. 121, a regulation that sets the standard for air brake systems in heavy vehicles, ensuring safety through specified design, performance, and maintenance requirements.

Governor Cut-Out

A mechanism or setting in an engine or turbine that limits maximum speed by cutting fuel supply or introducing a brake.