One way to think of "adaptive expectations", is that they:
A) Prevent asset bubbles from forming.
B) Take into account all available information and expectations.
C) Are backward looking or trend following.
D) Lead to a declining fundamental asset value.

Question

Quizplus · Accepted Answer

Adaptive expectations are based on past events and trends, meaning they adjust future expectations based on what has previously happened, making them backward looking or trend following.

One Way to Think of "Adaptive Expectations", Is That They