Repetitive patterning facilitates inferences about likely properties of sound to follow. Mismatch negativity (MMN) occurs when sound fails to match an inference. Smaller MMN in schizophrenia indexes deficient gain control (difference in utilizing a limited dynamic range). Although it is clear that this group has a lower limit to MMN size, this study addressed whether smaller MMN indicates impaired perceptual inference. MMN was elicited to four deviants in two sequences: one in which occurrence was random and one in which it was paired. Despite smaller MMN, persons with schizophrenia are equally able to reduce MMN size evoked by a deviant when its occurrence is cued. Results also expose alterations in the evoked response to repeated sounds that appear to be exacerbations of age-related amplitude decline. Since these anomalies impact the computed MMN, they highlight the need to identify all contributions to limits in gain control in schizophrenia.