Exhibit 29-1

Refer to Exhibit 29-1. Suppose the supply curve is S₂ and the price is A. Economic rent equals area

Question

Exhibit 29-1 Refer to Exhibit 29-1. Suppose the supply curve is S₂ and the price is A. Economic rent equals area

Quizplus · Accepted Answer

Economic rent is the difference between the market price and the minimum amount required to bring forth the supply. In this case, the minimum supply required is at point B on the supply curve, and the market price is at point A. Therefore, economic rent equals area ABD.

Exhibit 29-1 ​ Refer to Exhibit 29-1. Suppose the Supply Curve Is S2

Exhibit 29-1 Refer to Exhibit 29-1. Suppose the Supply Curve Is S₂