Suppose you operate a small manufacturing firm in long


Suppose you operate a small manufacturing firm in Long Island City and you recently developed a unique, new production process that will allow your shop to earn $500 more per month in profit. Your landlord hears about this and smiles since she remembers from her urban economics class that all economic development benefits accrue to landowners. She says, "Since the supply of land is inelastic, you will now have to pay me $500 more per month in rent." Is your landlord correct? Explain.

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Microeconomics: Suppose you operate a small manufacturing firm in long
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