This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: The rational-expectations hypothesis suggests that the forecasts that people make concerning future ... (Read 70 times)

Mimi

  • Hero Member
  • *****
  • Posts: 542
on: Apr 19, 2019

Question 1

The problem with the traditional macroeconomic treatment of expectations of inflation is that


◦ the model is not consistent with the microeconomic assumption that individuals are rational, forward-looking people.
◦ the model assumes that individuals will merely guess at what the inflation rate will be.
◦ in the model people always assume that inflation will be zero.
◦ the way people formulate expectations in that model assumes that individuals are highly sophisticated in their economic thinking.

Question 2

The rational-expectations hypothesis suggests that the forecasts that people make concerning future inflation rates


◦ are always correct.
◦ consistently overestimate the actual rate of inflation in the future.
◦ are correct on average, but are subject to errors that are distributed randomly.
◦ consistently underestimate the actual rate of inflation in the future.
Principles of Economics ¦ Case, Fair, Oster ¦ 12th Edition
Buy Test-Bank


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by Mimi on Apr 19, 2019

izzat

  • Sr. Member
  • ****
  • Posts: 328
Reply #1 on: Apr 19, 2019
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
Answer Preview
Only 29% of students answer this correctly


Mimi

  • Member
  • Posts: 542
Reply 2 on: Apr 19, 2019
Thanks for the timely response, appreciate it

EAN94

  • Member
  • Posts: 307
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

Blastomycosis is often misdiagnosed, resulting in tragic outcomes. It is caused by a fungus living in moist soil, in wooded areas of the United States and Canada. If inhaled, the fungus can cause mild breathing problems that may worsen and cause serious illness and even death.

Did you know?

According to the American College of Allergy, Asthma & Immunology, more than 50 million Americans have some kind of food allergy. Food allergies affect between 4 and 6% of children, and 4% of adults, according to the CDC. The most common food allergies include shellfish, peanuts, walnuts, fish, eggs, milk, and soy.

Did you know?

Your heart beats over 36 million times a year.

Did you know?

Intradermal injections are somewhat difficult to correctly administer because the skin layers are so thin that it is easy to accidentally punch through to the deeper subcutaneous layer.

Did you know?

The types of cancer that alpha interferons are used to treat include hairy cell leukemia, melanoma, follicular non-Hodgkin's lymphoma, and AIDS-related Kaposi's sarcoma.

Why people don't stop smoking Why people don't stop smoking
Blocked at every turn by congressional Republicans who hated him, President Obama turned to techniqu Blocked at every turn by congressional Republicans who hated him, President Obama turned to techniqu
Add 5 more to make 9 Add 5 more to make 9
Long-range forecasts Long-range forecasts
Famous People with Parkinson's Disease Famous People with Parkinson's Disease
Meiosis is used to make sperm and egg cells. A shows a simplified version and B shows a detailed ver Meiosis is used to make sperm and egg cells. A shows a simplified version and B shows a detailed ver
Video: Interview with an Anorexic Woman (Part 2 of 2)

For a complete list of videos, visit our video library