Questions are related Specific-Factors Model.

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Robert · Accepted Answer

1 
 
The given data is summarized below. 
Computers -   
Sale revenue 
 
PC. QC 150 
Payment to labor 
 
W. LC 75 
Payment to capital 
 
RK. K 75
Barley -   
Sale revenue 
 
PB. QB 150 
Payment to labor 
 
W. LB 70 
Payment to capital 
 
RT. T 80
Question 1 
% increase in the price of barely = 10%  
% change in wage = 5% 
The aim is to determine the impact of the increase in the price of barely on the rental rate on the 
land.  
Rental on the land = {Sale revenue (barley) - payment to the labor (barley)} / Total land  
 = (PB. QB - W. LB) / T 
Additionally,

Questions are related Specific-Factors Model.

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