According to the Rational Expectations View, the Government Can Change

question 29

Multiple Choice

According to the rational expectations view, the government can change real output by:

• A)making appropriate and well-publicized fiscal and monetary policy changes in the long run.
• B)making appropriate and well-publicized fiscal and monetary policy changes in the short run.
• C)making unexpected changes in aggregate demand.
• D)keeping the economy away from inflation.
• E)making unexpected changes in aggregate supply.

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Definitions:

Tundra

(tundra) A treeless biome between the boreal forest in the south and the polar ice cap in the north that consists of boggy plains covered by lichens and small plants. Also called arctic tundra. Compare with alpine tundra.

Temperate Desert

A type of desert found in temperate climates, characterized by relatively low temperatures compared to tropical deserts.

Climax Community

The final, stable community in succession that remains relatively unchanged until disrupted by an event like fire or human interference.

Forest Communities

Ecosystems composed of trees and other plant species, along with associated animals, microorganisms, and the physical environment, interacting as a unit.