Michelle can work at job A earning $50,000 a year, job B earning $83,000 a year, or job C earning $85,000 a year. If Michelle chooses job C, then her economic rent for working at job C rather than job B is

Question

Quizplus · Accepted Answer

Economic rent is the extra amount Michelle earns by choosing the highest paying job over the next best alternative. Since job C pays $85,000 and job B pays $83,000, the economic rent is $85,000 - $83,000 = $2,000.

Michelle Can Work at Job a Earning $50,000 a Year