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According to the Rational Expectationists

Question 161

Multiple Choice

According to the rational expectationists


A) the so-called recessionary and inflationary gaps of the 1970s did not exist.
B) even if there were a recession or substantial inflation,the best government policy would be to do nothing.
C) the dramatic oil price shocks of 1973 and 1979 created declines in aggregate supply,lowering the natural level of real GDP.
D) the prime economic mover is aggregate supply,not aggregate demanD.
E) All of the choices/statements are truE.

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