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    Exam 39: Current Issues in Macro Theory and Policy
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    In the Rational Expectations View
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In the Rational Expectations View

Question 66

Question 66

Multiple Choice

In the rational expectations view,


A) wages are flexible downward but prices are inflexible downward.
B) prices are flexible downward but wages are inflexible downward.
C) discretionary policy tends to be countercyclical.
D) discretionary policy tends to be ineffective.

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