The 'rational expectations' hypothesis assumes people: MCQ with Answer and Explanation

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The 'rational expectations' hypothesis assumes people:

A. have no expectations

B. only use past values

C. use all available information to form expectations

D. ignore information

Answer: Option C

Solution (By JKSSB Mock Tests)

Rational expectations assumes agents use all available information efficiently.

This question belongs to: Economy GK Economy Set 1

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Question #1

The 'Goods and Services Tax' rate on bicycles is:

A. 5%

B. 18%

C. 0%

D. 12%

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Correct Answer: Option A

Explanation:
Bicycles attract 5% GST.

This question belongs to: Economy GK Economy Set 1

Question #2

Which of the following is a feature of the Indian tax system?

A. Only indirect taxes

B. Only direct taxes

C. Both direct and indirect taxes

D. No progressive taxation

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Correct Answer: Option C

Explanation:
The Indian tax system consists of both direct taxes (income tax, corporation tax) and indirect taxes (GST, customs duty), with progressive elements in direct taxes.

This question belongs to: Economy GK Economy Set 1

Question #3

The 'shadow economy' refers to:

A. formal sector activities

B. unreported economic activities outside the formal sector

C. stock market

D. banking sector

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Correct Answer: Option B

Explanation:
The shadow economy consists of unreported economic activities.

This question belongs to: Economy GK Economy Set 1

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