Zero inflation
a. might be dangerous because it could lead to rapidly increasing prices.
b. would limit the flexibility of the labor market and so could at times raise unemployment.
c. would make it easy for the Central bank to create negative real interest rates.
d. is impossible to achieve in the real world.
b
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An economic system in which ritual, habit, and custom dictate most economic and social behavior
a. command economy b. traditional economy c. market economy d. free enterprise economy
Suppose a farmer in a perfectly competitive agricultural industry rents land that is uniquely productive in the production of a certain crop. In the long run
A) the owner of the land receives economic rent while the farmer earns zero economic profit. B) the owner of the land earns zero economic profit while the farmer receives economic rent. C) both the farmer and the owner of the land receive economic rent. D) neither the farmer nor the owner of the land receive economic rent.