According to the Rational Expectations Theory, People Base Their Expectations

question 87

Multiple Choice

According to the rational expectations theory, people base their expectations about inflation on _____

• A) the announcement of a change in policy.
• B) weighted averages of previous inflation rates, with the most distant getting the heaviest weight.
• C) all information available to them.
• D) changes in monetary policy only.
• E) changes in both monetary and fiscal policy.

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Definitions:

Traditionally Urban Jobs

Occupations commonly found in city environments, often relating to industries like finance, services, and technology.

Rural Rebound

A demographic trend where people move from urban to rural areas, often seeking improved quality of life or to escape the congestion of cities.

Urban Boomerang

The phenomenon where individuals leave urban areas for rural or less dense areas, only to return to the city after a period.

Social Movement

An organized collective effort by a large group of people to bring about or resist social change, often aiming to address societal issues or grievances.