Examlex
Match the following test names with the correct test purpose.
-CBC
Rational Expectations
An economic theory suggesting that individuals make predictions about future events using all available information, thus their expectations are on average correct.
Rational Expectations
The hypothesis in economics that assumes individuals form forecasts of future events based on all available information in an unbiased and rational manner.
Potential Output
The highest level of output an economy can produce without leading to inflation, when operating at full employment.
Monetary Policy
Actions undertaken by a central bank to control the money supply and interest rates to achieve macroeconomic objectives like controlling inflation, consumption, growth, and liquidity.
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