Question

The idea of rational expectations suggests that :_________

a) It is unrealistic for Congress to balance the federal budget during a recession.
b) Discretionary policies and fine-tuning can move the economy to full employment.
c) Economic policies are ineffective if the policies are anticipated.

Answer 1

Answer:C

Explanation:The theory believes that because people make decisions based on the available information at hand combined with their past experiences, most of the time their decisions will be correct.