One major assumption of the theory of rational expectations is that
A) all firms use rational expectations.
B) the economy does not have a self-correction mechanism.
C) the economy has a very effective self-correction mechanism.
D) all consumers use rational expectations.
Correct Answer:
Verified
Q29: Q30: According to crude versions of the quantity Q31: The _ hypothesis is based on the Q32: The new classical economists are the Q33: Milton Friedman and others,citing imperfections and mistakes Q35: Supply-side economists believe that,in general, Q36: Keynesian economists tend to believe that the Q37: Supply-side economists would say that tax rates Q38: Which one of the following macroeconomic theories Q39: Systematic error is most clearly associated with
A)Keynesians.
B)economic behaviorists.
C)supply-siders.
D)rational
A)by raising tax
A)rational
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