Suppose that a community seeks to preserve air quality, and zones a "green belt" around the city, which prevents property development within the belt.What is the most likely result of this law?
A)Interest rates will increase.
B)Labor income will increase.
C)Economic rent will increase.
D)Profits will increase.

Question

Quizplus · Accepted Answer

By preventing property development within the green belt, the supply of available land for development decreases. This will increase the price of land within the green belt and therefore increase the economic rent (landlords' profits due to scarcity of land). Interest rates, labor income, and profits are unlikely to be directly impacted by this law.

Suppose That a Community Seeks to Preserve Air Quality, and Zones