One key implication of rational expectations is that
A) anticipated monetary policy has no effect on the rate of unemployment or the level of real GDP.
B) unanticipated monetary policy has no effect on the economy but anticipated monetary policy does have an effect on the economy.
C) anticipated monetary policy can affect the rate of unemployment but not the level of real GDP.
D) both unanticipated monetary policy and anticipated monetary policy have an effect on the economy.
C
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The value of labor is in skill, effort and knowledge
Indicate whether the statement is true or false
If the rate of inflation in a given time period turns out to be higher than lenders and borrowers anticipated, then the effect will be:
a. no change in the distribution of wealth between lenders and borrowers. b. a net gain in purchasing power for lenders relative to borrowers. c. a redistribution of wealth from borrowers to lenders. d. a redistribution of wealth from lenders to borrowers.