The Figure Given Below Represents Equilibrium in the Labor Market

The figure given below represents equilibrium in the labor market with the demand and supply curves of labor.Figure 14.6
In the figure,
D = MRP implies demand for labor = Marginal Revenue Product
MFC represents Marginal Factor Cost curve
S represents the supply curve of labor

-Earnings of a resource is termed as economic rent if:

A) it has a perfectly elastic demand.
B) it has a perfectly elastic supply.
C) it has a perfectly inelastic supply.
D) it has a perfectly inelastic demand.
E) it has no demand.

Correct Answer:

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