ECONOMICS
TECHNOLOGY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Economic Rent= Actual income + transfare earning + extra income
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Economic Rent= Actual income + transfare earning
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Economic Rent= Actual income-transfare earning
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Economic Rent= Actual income + transfare earning
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Detailed explanation-1: -Economic Rent = Marginal Product – Opportunity Cost The equation above can also be rearranged to solve for marginal product and opportunity cost.
Detailed explanation-2: -Transfer earnings are the minimum income a worker needs in order to supply their labour. Economic rent is the extra income a worker receives – above the minimum level they need in order to work.
Detailed explanation-3: -What Is Economic Rent? Economic rent is an amount of money earned that exceeds that which is economically or socially necessary. This can occur, for example, when a buyer working to attain a good or service that is considered exclusive makes an offer prior to hearing what a seller considers an acceptable price.
Detailed explanation-4: -According to modern theory, economic rent is a surplus which is not peculiar to land alone. It can be a part of income of labour, capital, entrepreneur. According to modern version rent is a surplus which arises due to difference between actual earning and transfer earning.