If a Factor of Production with a Fixed Supply Is

question 110

Multiple Choice

If a factor of production with a fixed supply is earning $100 in its current use and its next best use would yield earnings of $80, the factor is earning a pure economic rent equal to

• A) $0.
• B) $20.
• C) $80.
• D) $180.

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Definitions:

Percentages

A mathematical concept that represents a fraction of 100, commonly used to describe proportions or ratios.

Monthly Budget

A financial plan that outlines expected income and expenses for a month, helping individuals or organizations manage their money.

Breakfast Cereals

A type of food made from processed grains that is often eaten with milk, yogurt, or fruit as the first meal of the day.

Consumer Spending

The total amount of money spent by consumers in an economy on goods and services.