The text proposes the following model of expected inflation z=(1-0) x + 0%-1 What do we know about your process of the formation of expected inflation when 0=07 OA. Neither last year's inflation rate nor the long-run average inflation rate impact your view on this year's expected rate. OB. Last year's inflation rate will influence you to revise your estimates for this year's expected rate. OC. Regardless of what inflation was last year, you would expect it to be at the long-run average inflation rate this year. OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate What do we know about your process of the formation of expected inflation when 0-17 OA. Neither last year's inflation rate nor the long run average inflation rate impact your view on this year's expected rate OB. Last year's inflation rate will be the only input for you to revise your estimates for this year's expected rate regardless of what the long-run average inflation rate is OC. Regardless of what inflation was last year, you would expect it to be at the long run average inflation rate this year. OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate If you look mainly at what the inflation rate was last year when trying to predict what inflation will be t year, then you believe that 0 is near 1 0 0.5
The text proposes the following model of expected inflation z=(1-0) x + 0%-1 What do we know about your process of the formation of expected inflation when 0=07 OA. Neither last year's inflation rate nor the long-run average inflation rate impact your view on this year's expected rate. OB. Last year's inflation rate will influence you to revise your estimates for this year's expected rate. OC. Regardless of what inflation was last year, you would expect it to be at the long-run average inflation rate this year. OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate What do we know about your process of the formation of expected inflation when 0-17 OA. Neither last year's inflation rate nor the long run average inflation rate impact your view on this year's expected rate OB. Last year's inflation rate will be the only input for you to revise your estimates for this year's expected rate regardless of what the long-run average inflation rate is OC. Regardless of what inflation was last year, you would expect it to be at the long run average inflation rate this year. OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate If you look mainly at what the inflation rate was last year when trying to predict what inflation will be t year, then you believe that 0 is near 1 0 0.5
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:The text proposes the following model of expected inflation
x = (1 - 0) x + 0,-1
What do we know about your process of the formation of expected inflation when 0 = 07
OA. Neither last year's inflation rate nor the long-run average inflation rate impact your view on this year's expected rate.
OB. Last year's inflation rate will influence you to revise your estimates for this year's expected rate.
OC. Regardless of what inflation was last year, you would expect it to be at the long-run average inflation rate this year.
OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate.
What do we know about your process of the formation of expected inflation when 0-17
OA. Neither last year's inflation rate nor the long-run average inflation rate impact your view on this year's expected rate
OB. Last year's inflation rate will be the only input for you to revise your estimates for this year's expected rate regardless of what the long-run average
inflation rate is
OC. Regardless of what inflation was last year, you would expect it to be at the long-run average inflation rate this year.
OD. Last year's inflation rate and the long-run average inflation rate have an equal impact on your view of this year's expected rate
If you look mainly at what the inflation rate was last year when trying to predict what inflation will be this year, then you believe that 0 is near
1
0
0.5
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