Adaptive Expectations Are Formed by Looking at

question 49

Multiple Choice

Adaptive expectations are formed by looking at

• A)the average changes of a variable.
• B)changes in all substitute variables.
• C)both past and expected future values of a variable.
• D)past values of a variable.

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Definitions:

Supply

The total amount of a certain good or service that is available for purchase at a particular price level and time.

Perfectly Inelastic

Refers to a market situation where the quantity demanded or supplied does not change regardless of the price level changes.

Perfectly Elastic

Describes a market situation where quantity demanded or supplied changes by an infinite amount in response to any change in prices.

Demand

The willingness and ability of consumers to purchase goods and services at various prices.