According to the rational expectations view of interest rates, the forecasting of rates requires knowledge of the public's current set of interest rate expectations.

Question

Quizplus · Accepted Answer

The rational expectations theory suggests that individuals form their expectations about the future based on all available information, including current and anticipated future policies, hence forecasting interest rates requires understanding the public's current expectations about those rates.

According to the Rational Expectations View of Interest Rates, the Forecasting