If investors ________, we would assume that do not make systematic mistakes when forecasting exchange rates.

Here is the answer for the question – If investors ________, we would assume that do not make systematic mistakes when forecasting exchange rates.. You’ll find the correct answer below

If investors ________, we would assume that do not make systematic mistakes when forecasting exchange rates.
a. have rational expectations
b. have complete knowledge of all possible bid and ask quotes
c. know that interest rate differentials provide information about the intensity of devalua- tions
d. anticipate events that occur

The Correct Answer is

a. have rational expectations

Reason Explained

a. have rational expectations is correct for If investors ________, we would assume that do not make systematic mistakes when forecasting exchange rates.

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