The Rational Expectations Hypothesis Implies That Discretionary Macro-Policy Will

question 91

Multiple Choice

The rational expectations hypothesis implies that discretionary macro-policy will:

• A)be ineffective, even in the short run.
• B)be effective in the short run but ineffective in the long run.
• C)be effective both in the short run and long run.
• D)make it possible to trade-off a higher rate of inflation for a lower rate of unemployment.

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Definitions:

Outcomes

The results or consequences of specific actions, strategies, or interventions within a given context or enterprise.

Activities

Tasks or actions undertaken by individuals, usually referring to events involving movement, creativity, or social interaction.

Sales Contest

A competitive event designed to motivate sales personnel to increase their sales performance over a certain period.

Short-term Incentive

A reward system designed to motivate employees over a brief period, often meant to boost immediate performance or achieve specific short-term objectives.