The theorists of the rational expectations school: a. favor ...

[tatyanajohnson]

The theorists of the rational expectations school:
 a. favor monetary rules because they believe individuals know too little about how the economy works.
 b. favor monetary rules so that workers and firms do not get any unanticipated surprises from the Fed.
 c. are those who favor an active approach to policy and reject monetary rules.
 d. oppose any monetary rules because they believe rules impede the natural self-correcting mechanism of the economy.
  e. do not believe in implementing discretionary policies.

Question 2

According to the rational expectations school, a correctly anticipated expansionary monetary policy will:
 a. increase prices and real output.
 b. increase real output only in the short run.
  c. have no effect on prices or real output.
  d. decrease prices and real output.
 e. lead only to a higher price level.

[succesfull]

Answer to Question 1

b

Answer to Question 2

e

[tatyanajohnson]

Thanks for the timely response, appreciate it

[bitingbit]

Gracias!