Who does NOT earn economic rent in a competitive factor market?
A) No one
B) Everyone
C) The last factor of production hired
D) The inframarginal workers
E) Only owners of physical properties earn economic rents.

Question

Quizplus · Accepted Answer

In a competitive factor market, economic rent refers to the payment to a factor of production in excess of the minimum required to bring that factor into use. The last factor of production hired is typically paid its marginal product, which is the minimum necessary to employ it, thus it does not earn economic rent. In contrast, inframarginal workers or factors (those hired before the last one) do earn economic rent because they are paid more than the minimum necessary to bring them into use.

Who Does NOT Earn Economic Rent in a Competitive Factor