The Proponents of Rational Expectations Believe That

question 24

Multiple Choice

The proponents of rational expectations believe that:

• A) there will be a substantial time lag before people anticipate the eventual effects of a shift to a more expansionary macro-policy.
• B) macro-policies that stimulate demand and place upward pressure on the general level if prices will temporarily increase output and employment.
• C) the inflationary side effects of expansionary policies will be anticipated quickly, and therefore, even their short-run effects on real output and employment will be minimal.
• D) discretionary changes in macro-policy can be made in a manner that will reduce the economic ups and downs of a market economy.

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Definitions:

Scan Time

The time taken by a programmable logic controller (PLC) to read inputs, execute logic, and update outputs, crucial for the timing of control processes.

Scan Time

The amount of time it takes for a PLC to complete one cycle of reading input conditions, executing logic, and updating outputs.

PLC

A programmable logic controller, an industrial digital computer adapted for controlling manufacturing processes.