Which of the following should not be included in a list of fundamental results derived from modern macroeconomic theory?
A) People form expectations of the future based on unbiased processing of all available information gleaned from their individual and collective experiences.
B) It is useful to describe macroeconomic policy as a set of policy rules: active, passive, and in some cases) discretionary.
C) Policy effectiveness depends on its credibility.
D) All of the above should be included in a list of fundamental propositions.
E) None of the above should be included in a list of fundamental propositions.

Question

Quizplus · Accepted Answer

Each of the statements (A, B, C) reflects key insights from modern macroeconomic theory: rational expectations, the importance of policy rules, and the role of credibility in policy effectiveness. Therefore, all should be included in a list of fundamental propositions derived from modern macroeconomic theory.

Which of the Following Should Not Be Included in a List