Suppose the supply of ocean front property in California is perfectly inelastic. Any increases in demand for this property increases the

Question

Quizplus · Accepted Answer

When the supply of ocean front property in California is perfectly inelastic, any increase in demand for this property will result in an increase in economic rent, which is the amount of money that a property owner can charge for the use of their property. Since the supply cannot increase to meet the increase in demand, the property owners have more bargaining power and can charge a higher rent. Therefore, the correct answer is A.

Suppose the Supply of Ocean Front Property in California Is