When people use all the relevant data and principles of economics to forecast inflation, they are making
A) what is called a "data-based forecast."
B) an always accurate forecast.
C) a mistake.
D) what is called a "rational expectation."
E) an exaggerated forecast.
D
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The income effect of a price change results in a
A) movement along the demand curve due to a change in relative prices. B) shift of the demand curve when income changes. C) shift of the demand curve due to a change in purchasing power brought about by the price change. D) movement along the demand curve due to a change in purchasing power brought about by the price change.
Cost-benefit analysis cannot be applied to collective or public choice decision-making
a. True b. False Indicate whether the statement is true or false
The short-run equilibrium in the aggregate demand–aggregate supply model occurs at the point of intersection of the: a. short-run aggregate supply curve and the aggregate demand curve. b. long-run aggregate supply curve and the aggregate demand curve. c. marginal social cost curve and the aggregate demand curve
d. investment spending curve and the consumption curve.
When the Fed sells bonds in the open market, we can expect
A) bond prices and interest rates to fall. B) bond prices to rise and interest rates to fall. C) bond prices to fall and interest rates to rise. D) bond prices and interest rates to rise.