Which of the following is a key difference between a rational expectations perspective and an adaptive expectations perspective? The adaptive expectations perspective believes individuals have access to limited data and change expectations gradually while the rational expectations perspective is that prices change quickly as new economic information becomes available. Rational expectations are based off of historical data while adaptive expectations use real time data. Government agencies tend to have rational expectations, due to their access to economic data, while the public at large tends to hold adaptive expectations A rational expectations perspective expects changes to happen very slowly, while adaptive expectations perspectives tend to expect fast change.

Which of the following is a key difference between a rational expectations perspective and an adaptive expectations perspective? The adaptive expectations perspective believes individuals have access to limited data and change expectations gradually while the rational expectations perspective is that prices change quickly as new economic information becomes available. Rational expectations are based off of historical data while adaptive expectations use real time data. Government agencies tend to have rational expectations, due to their access to economic data, while the public at large tends to hold adaptive expectations A rational expectations perspective expects changes to happen very slowly, while adaptive expectations perspectives tend to expect fast change.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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