For Resources with Upward-Sloping Supply Curves

question 21

Multiple Choice

For resources with upward-sloping supply curves:

• A)earnings consist solely of economic rent.
• B)earnings consist of both transfer earnings and economic rent.
• C)earnings are called transfer earnings.
• D)earnings are called dividends.
• E)earnings consist entirely of in-kind transfers.

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Definitions:

Inelastic

This refers to a lack of sensitivity in the quantity demanded or supplied when the price changes.

Elastic

Describes a situation in economics where the demand or supply for a good or service significantly changes in response to a change in price.

Substitute Goods

Products or services that can be used in place of one another, with their demand being inversely related: as the price of one rises, the demand for the other increases.

Margarine

A butter substitute made from vegetable oils or animal fats, often used in cooking or as a spread.