Adaptive expectations are "__________" according to the New Classical economists because they __________ information it is possible to use in making a forecast.
A) rational; include all
B) rational; exclude some
C) irrational; include all
D) irrational; exclude some

Question

Quizplus · Accepted Answer

Adaptive expectations are considered "irrational" by New Classical economists because they rely on past information and exclude some available information that could be used to make more accurate forecasts.

Adaptive Expectations Are "__________" According to the New Classical Economists