Question

Economists disagree about how quickly the economy adjusts to an aggregate demand shock. In the view of some economists, people form expectations based on present realities and change expectations gradually as their experience unfolds. Such expectations are said to be _____________.

Answer 1

Answer:

adaptive

Explanation:

change expectation with the experience means that the individual develop rational expectations and makes decisions based on past experiences and future expectations. However, as expectations change slowly, contingency estimates are adaptive .  

Therefore, such expectations are called in adaptive