Which of the following would be strong evidence that imperfect information explained departures of actual demand from potential?
A) noting that the theory of imperfect information provides a story of how the departure might come about without relying on sticky prices
B) observing that positive price shocks in the real world seem to happen just prior to an economic boom
C) observing that positive price shocks in the real world seem to happen just prior to an economic recession
D) observing that negative price shocks in the real world seem to happen just before an economic boom
E) none of the above

Question

Quizplus · Accepted Answer

The Answer of Which of the following would be strong evidence that imperfect information explained departures of actual demand from potential?
A) noting that the theory of imperfect information provides a story of how the departure might come about without relying on sticky prices
B) observing that positive price shocks in the real world seem to happen just prior to an economic boom
C) observing that positive price shocks in the real world seem to happen just prior to an economic recession
D) observing that negative price shocks in the real world seem to happen just before an economic boom
E) none of the above

Which of the Following Would Be Strong Evidence That Imperfect