Question

Describe the Theory of Rational Expectation and give an example

Describe the Theory of Rational Expectation and give an example

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The rational expectation theory in the economics suggest that the personal decision are dependent on three things mainly. They are rationality, past experience and what ever information is available to them.

For example, John wants to buy an ice cream from a local store, he will choose the products that he has consumed before. and he has all the information to make a decision. even after buying that ice cream  he gives it for the donation, he has taken that decision to satisfy his need and he is fully aware of that.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
3. What is a Theory? Give an example of a theory in Organizational Behavior, and describe...
3. What is a Theory? Give an example of a theory in Organizational Behavior, and describe it. 4. Describe how you could test whether drinking 8 ounces of celery juice per day reduces hypertension. 5. Describe the The Rational Decision Making Model and the Behavioral Decision Making Model. Why do people rarely use the Rational Decision Making Model to make decisions? 6. What is the difference between the heuristics Anchoring and Adjustment & Escalation of Commitment? Give an example of...
Give three examples on how prospect theory challenges rational behavioral assumptions of the utility theory.
Give three examples on how prospect theory challenges rational behavioral assumptions of the utility theory.
We cannot say an expectation is rational if ________? the expectation is different from what the...
We cannot say an expectation is rational if ________? the expectation is different from what the Fed expects. only some people have this expectation. not all the information is used to form the expectation. the expectation ends up to be wrong. What kind of monetary policy can be used to reduce the rate of inflation? Selling bonds Lowering the interest rate Any expansionary monetary policy would work. None of the above would work. Suppose we hold money velocity constant, which...
Describe in your own words Seligman’s Preparedness Theory. Give your own example of how this would...
Describe in your own words Seligman’s Preparedness Theory. Give your own example of how this would manifest in a human.
Describe agency theory and provide an example
Describe agency theory and provide an example
define Affect Theory in anthropology, give an example ​
define Affect Theory in anthropology, give an example ​
Describe comparative advantage theory and gravity model theory. give examples.
Describe comparative advantage theory and gravity model theory. give examples.
graph theory give an example or show that no such example exists of a nonregular graph...
graph theory give an example or show that no such example exists of a nonregular graph whose complement is regular.
Explain what is nondeterminism. Give an example. Automata Theory
Explain what is nondeterminism. Give an example. Automata Theory
pros of the rational choice theory
pros of the rational choice theory
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT