Rational Expectation Theory Implies That Accurately Anticipated Change in Aggregate

question 85

Multiple Choice

Rational expectation theory implies that accurately anticipated change in aggregate demand:

• A)​will increase RGDP in the long run.
• B)​will affect RGDP and inflation only in the long run.
• C)​may affect RGDP but not nominal GDP.
• D)​will tend to be offset by the actions of input suppliers as they react to their inflation expectations.

---

Definitions:

Amino Acids

Organic compounds that are the building blocks of proteins, necessary for health and vital processes in living organisms.

Fluid-filled Sacs

Structures in organisms, such as bursae or cysts, containing liquid within a membranous enclosure, serving various physiological functions.

Double-Membrane Organelles

Cellular components surrounded by two lipid bilayers, including the nucleus, mitochondria, and chloroplasts in plants, playing various roles in cellular functioning.

Photosynthesis

The method through which green plants and certain organisms utilize sunlight to produce nutrients from carbon dioxide and water, releasing oxygen as a secondary product.