Question

1. Given the Water-Diamond Paradox its generally [ Select ] ["price", "abundance", "intrinsic value", "scarcity"]         that makes the consumption of an additional unit of [ Select ] ["scarcity", "water", "a diamond"] more valuable and hence the willingness to pay high prices for it.

2.

Suppose Tom Cruise is willing to work a film for $10M but he is then offered to do another film for $15M. What is his economic rent obtained by the second offer? $5M $10M $0 $15M

3.

Interest is paid to[ Select ] ["laborers", "the owners of land", "entrepreneurs", "the owners of capital"]      

Rent is paid to the [ Select ] ["the owners of land", "the owners of capital", "the owners of money", "entrepreneurs"]      

Wages are paid to [ Select ] ["labor", "Capitalists", "the owners of land", "the owners of capital"]      

Profit is the return to [ Select ] ["entrepreneurs", "the owners of capital", "the owners of land"]         for their engaging in [ Select ] ["risk", "having good ideas", "hard work"]  

4.

Economic rent is frequently associated with [ Select ] ["minimally skilled employees", "athletes only", "athletes and actors", "minimum wage workers"]      

Answer 1

1. Given the water diamond paradox, it is generally the intrinsic value that makes consumption of an additional unit of diamond more valuable and thus willingness to pay high prices for it.

2. Economic rent is $5. Economic rent is the excess pay that the worker received than the pay which he is willing to accept. Here, it is $15-$10= $5.

3. Interest paid to owners of capital

Rent paid to owners of land

Wages are paid to labor

Profit is the return to entrepreneur for their engaging in risk.

4. Economic rent is frequently associated with minimum wage workers. Most often labor gets higher wages than the wage that they were willing to work because of trade unions. Thus, the excess they get is known as economic rent.