Question: How does rational expectations differ from adaptive expectations? a. Rational expectations uses all available information, whereas adaptive expectations is heavily weighed toward recent information. b.

How does rational expectations differ from adaptive expectations?

a. Rational expectations uses all available information, whereas adaptive expectations is heavily weighed toward recent information.

b. Rational expectations is heavily weighted toward recent information, whereas adaptive expectations uses all available information.

c. Rational expectations fail to account for irrational or chaotic changes in the economy, whereas adaptive expectations can be used to anticipate irrational or chaotic changes in the economy, even if they have never been encountered before.

d. None of the above answers are correct.

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