New Keynesians and new classical economists both believe that
a. people form their expectations rationally.
b. aggregate demand movements primarily drive business cycles.
c. individual agents engage in optimizing behavior.
d. The key source of disagreement centered around how people form their expectations.
e. all but d are correct.
B
Economics
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An emphasis on inflation stability is compatible with a nonactivist stance only when shocks to the macroeconomy are ________
A) permanent supply shocks B) temporary supply shocks C) aggregate demand shocks D) all of the above E) none of the above
Economics