The figure given below represents an imperfectly competitive resource market. Here common land (and not land used for specific purpose) is under consideration.Figure 18.1

-An increase in demand for housing will reduce the availability of land for cultivation.

Question

The figure given below represents an imperfectly competitive resource market. Here common land (and not land used for specific purpose) is under consideration.Figure 18.1
 
-An increase in demand for housing will reduce the availability of land for cultivation.

Quizplus · Accepted Answer

Since the resource market shown in the diagram is imperfectly competitive and common land is under consideration, an increase in demand for housing will result in a decrease in the availability of land for cultivation. This is because land is a finite resource and its use for one purpose comes at the cost of its allocation for another purpose.

The Figure Given Below Represents an Imperfectly Competitive Resource Market