Under Rational Expectations

Multiple Choice

Under rational expectations,

A) people use all the information at their disposal to make their best forecast of the coming rate of inflation.
B) people use all past rates of inflation to make their best forecast of the coming rate of inflation.
C) people use announcements by the Fed to make their best forecast of the coming rate of inflation.
D) people use only the Fed's inflation target to make their best forecast of the coming rate of inflation.
E) people use the unemployment rate to make their best forecast of the coming rate of inflation.