McqMate
| Q. |
Economic rent refers to - |
| A. | Payment made for the use of labour |
| B. | Payment made for the use of capital |
| C. | Payment made for the use of organisation |
| D. | Payment made for the use of land |
| Answer» D. Payment made for the use of land | |
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Explanation: Rent refers to that part of payment by a tenant which is made only for the use of land, i.e., free gift of nature. The payment made by an agriculturist tenant to the landlord is not necessarily equals to the economic rent. A part of this payment may consist of interest on capital invested in the land by the land-lord in the form of buildings, fences, tube wells, etc. The term 'economic rent' refers to that part of payment which is made for the use of land only, and the total payment made by a tenant to the landlord is called 'contract rent'. Economic rent is also called surplus because it emerges without any effort on the part of a landlord. |
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