Problem
1. How does the theory of rational expectations differ from that of adaptive expectations?
2. What is the significance of the Lucas critique of econometric policy evaluation?
3. What is the time-inconsistency problem and what role does it play in the debate between advocates of discretion and rules in policy making?
4. What are the arguments for and against rules?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.