According to David Ricardo's Explanation of Land Rent, What Happens

question 8

Multiple Choice

According to David Ricardo's explanation of land rent, what happens when the demand for land increases?

• A) The supply curve shifts to the right just enough to keep the price per acre constant.
• B) Revenues to owners of land increase but economic rent declines.
• C) The amount of economic rent stays constant, constrained by a perfectly inelastic supply curve.
• D) Both revenues to owners of land and economic rent increase.

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Definitions:

Cost Of Switching

Cost of switching refers to the expenses a customer incurs as a result of changing from one product, supplier, or system to another.

Credit Policy

Guidelines a company follows to determine credit terms for customers, such as payment period and discounts for early payment.

Restocking Cost

The expenses involved in replenishing inventory or stock.