Even If People Have Rational Expectations

Multiple Choice

Even if people have rational expectations,

A) unannounced changes in monetary policy can never affect output
B) unemployment can never go below its natural rate
C) income tax cuts will have a permanent effect on output
D) supply shocks will not affect output or pries as long as the central bank accommodates them
E) money supply changes can affect real output if individuals mistake movements in absolute prices for relative price changes