If People Do Not Always Make the Same Mistakes When

question 216

Multiple Choice

If people do not always make the same mistakes when forecasting the future, then

• A)rational expectations are irrational.
• B)the Fed can control monetary policy and determine real variables such as real GDP.
• C)the policy irrelevance theorem holds.
• D)fiscal policy is more effective than monetary policy at fine-tuning the economy.

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Definitions:

Fast-Mapping

The process by which children are able to learn the meaning of a new word quickly and efficiently, often after a single exposure.

Lexical Addition

The process by which new words or phrases are introduced and incorporated into a language.

Categorical Embellishment

The addition of detailed or decorative elements to make a category or classification more distinct or appealing.

Vocabulary Expansion

The process of learning and acquiring new words to increase the breadth of one's language understanding and expression.