Manu Has Received a 2% Raise Each Year for the Past

question 43

Multiple Choice

Manu has received a 2% raise each year for the past 10 years. The company where he works has just experienced its most profitable year during that time, and Manu has had his most productive year yet and was the most productive worker in his section. Which of the following expectations of next year's salary would be consistent with Manu basing his expectations on rational expectations?

• A) Manu expects a 4% raise.
• B) Manu expects no raise.
• C) Manu has no idea of what raise he expects.
• D) Manu expects a 2% raise.

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Definitions:

Genetic Influences

The effects of genes inherited from parents on an individual's traits, behaviors, and susceptibility to conditions.

Monozygotic Twins

Twins that originate from a single fertilized egg, resulting in individuals with identical genetic makeup.

Genetic Similarities

The extent to which organisms share the same genes or genetic material, often used to describe the genetic relationship between family members or species.