Question: Suppose a change in the way a variable moves such that it is much smaller than before. If adaptive expectations accurately represent how people form
Suppose a change in the way a variable moves such that it is much smaller than before. If adaptive expectations accurately represent how people form expectations, then the difference between the variable and its expected value is less than zero.
There are many faults associated with adaptive expectations except that
A individuals utilize more information that just past data.
B predictions of future values affect expectations.
C past data do not help predict future values of variables.
D people adjust to new information.
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
