The Rational Expectations Hypothesis Suggests That If Wages and Prices

question 158

Multiple Choice

The rational expectations hypothesis suggests that if wages and prices are flexible

• A) unanticipated monetary policy actions can shift the long-run aggregate supply curve but cannot shift the aggregate demand curve.
• B) anticipated monetary policy actions can affect nominal variables, but not real variables.
• C) unanticipated monetary policy actions can affect real variables, but not nominal variables.
• D) growth in the money supply can alter real variables only if the growth is anticipated.

---

Definitions:

Educational Experience

The process of learning and acquiring knowledge, skills, attitudes, and values through formal instruction or life experiences.

Universal Education

The availability and provision of education to all individuals within a society, regardless of their background or socioeconomic status.

Germany

A country in Central Europe known for its rich history, contributions to art, science, and philosophy, as well as its role in world politics and economy.

September 1969

A specific month and year that may denote significant historical or cultural events, depending on the context in which it is referenced.