This topic contains a solution. Click here to go to the answer

Author Question: The primary argument against the rational-expectations assumption is that (Read 67 times)

abarnes

  • Hero Member
  • *****
  • Posts: 556

Question 1

The argument in favor of rational expectations is that


◦ people will continue to acquire information as long as the marginal benefit of that information is positive.
◦ individuals have a very good idea of what to expect from the government in terms of monetary policy but not fiscal policy.
◦ it is costless for individuals and firms to form rational expectations.
◦ if expectations were not rational, there would be unexploited profit opportunities available.

Question 2

The primary argument against the rational-expectations assumption is that


◦ the costs of formulating rational expectations are very low.
◦ it requires households and firms to know too much.
◦ it assumes that unexploited opportunities for profit persist in the economy.
◦ people expect certain outcomes from the government's policy actions.


Related Topics

Need homework help now?

Ask unlimited questions for free

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

frejo

  • Sr. Member
  • ****
  • Posts: 349
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



abarnes

  • Hero Member
  • *****
  • Posts: 556

frejo

  • Sr. Member
  • ****
  • Posts: 349
Great! Please up vote :D



 

Did you know?

In 2010, opiate painkllers, such as morphine, OxyContin®, and Vicodin®, were tied to almost 60% of drug overdose deaths.

Did you know?

Normal urine is sterile. It contains fluids, salts, and waste products. It is free of bacteria, viruses, and fungi.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

Did you know?

Amphetamine poisoning can cause intravascular coagulation, circulatory collapse, rhabdomyolysis, ischemic colitis, acute psychosis, hyperthermia, respiratory distress syndrome, and pericarditis.

For a complete list of videos, visit our video library