According to the rational and adaptive expectations arguments:
A) we must expect that policymakers will act rationally when adapting the economy to the needs of the general public.
B) it is in the best interest of each business and household to act exactly as macroeconomic policymakers expect it to act.
C) the Keynesian school is correct in saying the economy can never be expected to operate without some cyclical unemployment.
D) the effects of macroeconomic policies might be distorted by adjustments in business and household behaviors in anticipation of policymakers' strategies.
Correct Answer:
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