Under adaptive expectations theory, people expect the rate of inflation this year to be:
A. zero, regardless of the rate last year.
B. the same as last year.
C. the rate based on predictable and fiscal policies.
D. always higher than last year.
Answer: B
Economics
You might also like to view...
Explain why a price floor set below the equilibrium price is ineffective
What will be an ideal response?
Economics
Under a fixed exchange rate regime, if a country has an ________ exchange rate, then its central bank's attempt to keep its currency from depreciating will result in a ________ of international reserves
A) undervalued; gain B) undervalued; loss C) overvalued; gain D) overvalued; loss
Economics