If people assume that future rates of inflation will follow the ...

[berenicecastro]

If people assume that future rates of inflation will follow the pattern of inflation rates in the past, they are said to have
 
  A) rational expectations. B) accommodative expectations.
  C) unstable expectations. D) adaptive expectations.

Question 2

Ceteris paribus, in the long run, a negative supply shock causes
 
  A) the long-run aggregate supply curve to shift to the left.
  B) unemployment to fall below its short-run level.
  C) equilibrium real GDP to fall.
  D) the price level to rise initially, and then return to its lower level.

[efwsefaw]

Answer to Question 1

D

Answer to Question 2

D