The price of a factor of production that is in fixed supply is called
A)economic rent.
B)economic profit.
C)a compensating differential.
D)opportunity cost.

Question

Quizplus · Accepted Answer

Economic rent is the price paid for the use of a factor of production that is in fixed supply. This means that there is a limited amount of the factor available, and as demand for it increases, so does the price. Economic rent is also sometimes referred to as a "scarcity rent." The other options don't fit the definition of the price of a factor of production in fixed supply.

The Price of a Factor of Production That Is in Fixed