According to the text, if individuals base their expectations on the past, we could say that their expectations are:
A. adaptive.
B. regressive.
C. historical.
D. rational.
Answer: A
You might also like to view...
Suppose that each worker must use only one shovel to dig a trench, and shovels are useless by themselves. In the long run, the firm will experience
A) increasing returns to scale. B) constant returns to scale. C) decreasing returns to scale. D) The returns to scale cannot be determined from the information provided.
The short-run macro model
a. relies on the market-clearing assumption b. is used primarily for long-run analysis c. is used primarily for short-run analysis d. focuses on the supply of and demand for resources e. focuses on fluctuations in the financial markets to explain fluctuations in real GDP
The Coase theorem states that if pollution permits are tradable, the outcome will be optimal, _____
a. regardless of who initially gets the permits b. only if the property rights are assigned to the victims of pollution c. only if property rights are determined by the government d. only if the property rights are assigned to the party with the least-cost alternative
If the law of increasing opportunity costs is operable, and currently the opportunity cost of producing the 101st unit of good X is 5Y, then the opportunity cost of producing the 201st unit of good is X is most likely to be
A) less than 5Y. B) more than 1/5Y but less than 5Y. C) more than 5Y D) less than 1/5Y but more than zero.