If an Economist of the Rational Expectations School Were Advising

Multiple Choice

If an economist of the rational expectations school were advising a policy maker,the advice most likely to be given would be:

A) Don't use discretionary policy if recognition lags are long.
B) Don't use discretionary policy if activity lags are long.
C) Don't use fiscal policy if effectiveness lags are long.
D) Don't use monetary policy if implementation lags are long.
E) Don't use discretionary policy.