If people take into account the expected behavior of fiscal and monetary authorities in forecasting the behavior of inflation rates,they are most likely forming their projections using

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Rational expectations theory suggests that individuals use all available information, including past trends and current policies, to form their expectations about future economic conditions. Therefore, if people are forming their inflation rate projections by taking into account the expected behavior of fiscal and monetary authorities, they are most likely using rational expectations.

If People Take into Account the Expected Behavior of Fiscal