If managers expect the inflation rate to continue over time, they have _____ expectations.
A)adaptive
B)anchored
C)zero
D)rational

Question

Quizplus · Accepted Answer

Adaptive expectations refer to the idea that people form their expectations about future inflation based on past inflation rates. If managers expect the inflation rate to continue over time, they are likely using past inflation data to inform their expectations, which aligns with adaptive expectations.

If Managers Expect the Inflation Rate to Continue Over Time