When inflation causes relative-price variability,
a. consumer decisions are distorted and the ability of markets to efficiently allocate factors of production is impaired.
b. consumer decisions are distorted, but markets are still able to efficiently allocate factors of production.
c. consumer decisions are not distorted, but the ability of markets to efficiently allocate factors of production is impaired.
d. consumer decisions are not distorted and markets are still able to efficiently allocate factors of production.
a
You might also like to view...
Suppose that a major natural disaster destroys a large part of a country's capital stock but miraculously does not cause anybody bodily harm. What will happen to the real wage rate?
A. It will not change. B. It will rise. C. It will fall. D. It could rise or fall.
Applying Coase's theorem, if the cost to you from having the airplane seat in front of you reclined is ________ the benefit to the reclining passenger, you should ________
A) greater than; request a payment from the reclining passenger B) less than; request a payment from the reclining passenger C) greater than; make a payment to the reclining passenger D) less than; make a payment to the reclining passenger