According to the Adaptive Expectations Hypothesis

question 177

Multiple Choice

According to the adaptive expectations hypothesis,

• A)people will adapt to whatever income they are earning.
• B)the more people save,the less total savings will be available to the economy.
• C)the anticipated rate of inflation is based on the actual rates of inflation experienced during the recent past.
• D)the expected rate of inflation is adapted to macropolicy changes.

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Definitions:

Proactivity

The action of taking initiative, anticipating potential issues, and implementing solutions before problems arise.

Positive Affect

A dimension of emotional experience that refers to feelings that are enjoyable and pleasurable, including happiness, joy, and enthusiasm.

Decision Making

The cognitive process of selecting a course of action from among multiple alternatives, often involving judgment, evaluation, and problem-solving.

Organizational Citizenship

Behavior exhibited by employees that is beneficial to the organization but not directly recognized by the formal reward system.