Consider the following demand and supply curves in factor markets.
FIGURE 13- 5
-Refer to Figure 13- 5.Assume that all four factor markets are labour markets.The total amount paid to the workers is "economic rent" in diagram
A)1.
B)2.
C)3.
D)4.
E)1 or 4.

Question

Consider the following demand and supply curves in factor markets.
  FIGURE 13- 5
-Refer to Figure 13- 5.Assume that all four factor markets are labour markets.The total amount paid to the workers is "economic rent" in diagram
A)1. 
B)2. 
C)3. 
D)4. 
E)1 or 4.

Quizplus · Accepted Answer

Economic rent is the portion of payment to a factor of production that exceeds the owner's reservation price, typically represented by the area above the supply curve and below the price level in a supply and demand diagram.

Consider the Following Demand and Supply Curves in Factor Markets