Which of the following is a feature of a capitalist economy?
A. Absence of market mechanism
B. Collective ownership of resources
C. Private ownership of means of production and profit motive
D. Central planning of all economic activities
Answer: Option C
Solution (By JKSSB Mock Tests)
A capitalist (market) economy is characterised by private ownership of the means of production, profit motive, and resource allocation through the market mechanism.
Explanation:
The zero lower bound refers to the constraint that nominal interest rates cannot be reduced much below zero, limiting the effectiveness of conventional monetary policy in deep recessions.
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