If Land Becomes More Valuable in Residential Use Than in Commercial

question 162

Multiple Choice

If land becomes more valuable in residential use than in commercial use,

• A) the supply of land available for commercial use should decrease and the supply of land for residential use should increase.
• B) there can be no change in the allocation of land because land is fixed in supply.
• C) there will be no change in the allocation of land, as there is no responsiveness to price changes by suppliers of land.
• D) the supply of land for commercial use will become perfectly elastic, and the supply of land for residential use will become perfectly inelastic.

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Definitions:

Agricultural Act of 2014

A comprehensive statute passed in the United States that aimed to provide a policy framework for agriculture and food, including provisions for crop insurance and subsidies.

Rent-Seeking Activity

Efforts to increase one's share of existing wealth without creating new wealth, often through manipulation of the social or political environment.

Farm Subsidies

Financial assistance provided by the government to farmers and agribusinesses to supplement their income, manage the supply of agricultural commodities, and influence the cost and supply of such goods.

Overallocation

The excessive assignment or distribution of resources towards a particular area or sector, often leading to inefficiency.