The stock market, The Theory of Rational Expectations and the Efficient Market Hypothesis - Information, competition and the Stocks markets - Theory of Rational Expectations
4 important questions on The stock market, The Theory of Rational Expectations and the Efficient Market Hypothesis - Information, competition and the Stocks markets - Theory of Rational Expectations
What is the theory of rational expectations
Even though a rational expectation equals the optimal forecast using all available information, a prediction based on it may not always be perfectly accurate. Why?
- It takes too much effort to make their expectation the best guess possible.
- The best guess will not be accurate because the predictor is unaware of some relevant information.
What happens if there is a change in the way a variable moves?
well. (Changes in the conduct of monetary policy)
- Higher grades + faster learning
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What is the formula for rate of return from holdings?
The question on the page originate from the summary of the following study material:
- A unique study and practice tool
- Never study anything twice again
- Get the grades you hope for
- 100% sure, 100% understanding
