Economic Rent Homework Help

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The term rent, in economics,is referred to an extra income where there is no production cost, no enterprise no extra effort is required. For example, suppose two sellers purchased typically same quality product directly from the manufacturer with the same price. After that, those two sellers sold that product in two different markets.  One product is sold in $20 and other in $25 so this excess $5 which is earned without paying any extra effort and extra cost for further processing, is termed as economic rent.

It has different types and variety, to learn and realize this subject topic perfectly for doing a perfect homework in the class most of the students require a genuine economic rent homework help.

Different types

Rent is of several types. It is categorized on the basis of those factors for which owners can receive an extra earning or rent. The common categories are:

  1. Classical

Land is one of the most important factors in this world that we all know. It is an inelastic factor hence it is not possible to extend its expanse. In few countries, some expanse of lands is divided amongst the individual, so it’s become private property there. Often land owners allow someone else to use their land for a huge amount of money.

If those persons work hard for growing any specific crops like food grains,vegetables, fruits, etc. whatever they like, then entire production should be their right only. As they have already paid a huge amount to the land lord for that land.  But in reality, they have to give a share of their production to the land lord as an extra tax.

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  1. Paretian or Neoclassical

This type of extra income is not received from any natural resources it may be a part of some commercial factor. It is often noticed that some employees can receive extra wages or special benefits from the company not for their working ability but only for being a part of any association.

For example, often famous players get job in a higher pay scale not for their working ability but only for their fame.A union worker always receives excess amount of wages than another employee only because he or she is a part of that union.

  1. Monopoly

The extra income that an individual can get legally from any loyalty, copyrights, and patent, termed as monopoly economic rent

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