RDP 2016-02: Disagreement about Inflation Expectations Equation

μ=θ μ p +( 1θ ) μ r ,and σ 2 = θ 2 σ p 2 + ( 1θ ) 2 σ r 2 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGceaqabeaacqaH8o qBcqGH9aqpcqaH4oqCcqaH8oqBdaWgaaWcbaGaamiCaaqabaGccqGH RaWkdaqadaqaaiaaigdacqGHsislcqaH4oqCaiaawIcacaGLPaaacq aH8oqBdaWgaaWcbaGaamOCaaqabaGccaGGSaGaaGPaVlaaykW7caaM c8UaaGPaVlaaykW7caaMc8Uaaeyyaiaab6gacaqGKbaabaGaeq4Wdm 3aaWbaaSqabeaacaaIYaaaaOGaeyypa0JaeqiUde3aaWbaaSqabeaa caaIYaaaaOGaeq4Wdm3aa0baaSqaaiaadchaaeaacaaIYaaaaOGaey 4kaSYaaeWaaeaacaaIXaGaeyOeI0IaeqiUdehacaGLOaGaayzkaaWa aWbaaSqabeaacaaIYaaaaOGaeq4Wdm3aa0baaSqaaiaadkhaaeaaca aIYaaaaaaaaa@6719@