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:

Steam Engine

A heat engine that performs mechanical work using steam as its working fluid, fundamental to the Industrial Revolution for its role in powering machinery, trains, and ships.

Internet

A global network of interconnected computers that enables users to access information and communicate with each other across the world.

Communist Government

A political system where the state controls the economy and aims to achieve equality and the elimination of social classes through the abolition of private property.

Tourism Industry

A sector of the economy dealing with services related to organizing and providing travel and accommodations for tourists.