Respuesta :
Answer:
A factor of production will not earn economic rent when its supply is perfectly elastic.Hence,the answer here would be option C. or Perfectly Elastic.
Explanation:
- In Economics,economic rent is the additional revenue earned by the firm or any company from a certain constant supply of various factors resources or inputs of production.It is computed by taking the difference between the factor income or payment that the factor inputs actually receive and is supposed to receive under the factor market equilibrium conditions.
- One of the important pre-conditions of economic rent extraction is that concerned factors or inputs of production have to be perfectly inelastic or the supply of the factor inputs has to be completely unresponsive or non-reactive to the factor income or factor payments generated by these factors/inputs of production.
- In the case of perfectly elastic supply of the factors/inputs of production,any factor income or payment given to the factor inputs lower than what they are usually supposed to receive then the factor or input supply will be significantly or considerably reduced thereby limiting the ability of the firms or companies to generate any economic rent or additional revenue in the course of regular business operation.
The factors of production are those which are needed to produce the goods and services. They are used to the production of output that is finished good. The used goods and services determine the quality and quantity.
- The factors of the product will not make economic rent when the supply is perfectly elastic. If the supply is not perfectly elastic then some units will be available at a lower price than the price they actually get.
Hence the option C is correct.
Learn more about the actor of production will.
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