Economic rent is the difference between the payment actually received by the owner of a factor of production and her reservation price. In other words, economic rent is the extra amount of money earned by a factor of production above what the owner was willing to accept for its use.

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Economic Rent Is

Question 19

Multiple Choice

Economic rent is

A) The sum of the payment actually received by an owner of a factor of production and her reservation price
B) The difference between the payment actually received by the owner of a factor of production and her reservation price
C) The payment actually received by an owner of a factor of production
D) The reservation price of an owner of a factor of production

Correct Answer: