For which of the following natural resources does the appropriate model indicate that the price is determined by demand rather than by supply?? a.oil b.old-growth timber c.gold d.farm land
B? because it is the only renewable resource?
B
a
actually, the answer is d, but I dont know why!
i said d because farm land is relative to where it is located. if the particular land is not in demand, then there’s no reason for the price to be competitive.
:c well ok, no one controls the supply of land I guess
Land like water has fixed quantity. When Q is const. then demand determines the market price
D because land is FIXED. you cant make more of it. it is all demand, so prices can go to the moon.
supply of land is a vertical line, so only demand matters. However, this is not entirely true.
Can some explain the question a bit more clearly. The “appropriate model”?!
thunderanalyst Wrote: ------------------------------------------------------- > Land like water has fixed quantity. When Q is > const. then demand determines the market price What is the reverse of this, can you explain your logic with respect to oil? Thanks S