According to Rational Expectations Theory, Which of the Following Is

Multiple Choice

According to rational expectations theory, which of the following is false?

A) Expectations are based on imperfect information.
B) Errors in prediction are made at random and therefore do not result in systematic divergences between the actual and expected rate of inflation.
C) The current economic situation will have only limited impact on expectations.
D) Expectations are formed using currently available information.