If the Rational Expectation Theory Is Accurate, Equilibrium Real GDP

question 129

Multiple Choice

If the rational expectation theory is accurate, equilibrium real GDP will change in the short run:

• A)​whenever the aggregate demand curve shifts.
• B)​only if discretionary fiscal policy is used.
• C)​only if there is a shift in aggregate demand that could not have been predicted from the information available to the public.
• D)​only if discretionary monetary policy is used.

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Definitions:

Corporate Reputation

The perception of a company's trustworthiness, quality, and reliability by the public, customers, and stakeholders.

Shareholder Value

The return on investment that shareholders receive from a company, often seen as a primary goal of businesses, including profit and stock price appreciation.

Corporate Social Responsibility

A business model that helps a company be socially accountable to itself, its stakeholders, and the public, by practicing ethical and sustainable operations.

Greenwashing

Misleading consumers regarding a firm’s environmental practices or the environmental benefits of a certain product.