According to Rational Expectations

question 37

Multiple Choice

According to rational expectations

• A)expectations of inflation are viewed as being an average of past inflation rates.
• B)expectations of inflation are viewed as being an average of expected future inflation rates.
• C)expectations formation indicates that changes in expectations occur slowly over time as past data change.
• D)expectations will not differ from optimal forecasts using all available information.

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Definitions:

Interpersonal Intelligence

Howard Gardner's theory component that describes an individual's ability to understand and interact effectively with others.

Temperaments

Inherent personality traits that influence how individuals react to the environment and manage their emotions from a very early age.

Culturally Defined

Characteristics, norms, or behaviors that are recognized and accepted within specific cultural or societal contexts.

Subtheory

A division of a theory that focuses on a particular subset of assumptions and their implications.