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In the 1980s land prices in Japan surged upward in a speculative bubble. Land prices then fell for 11 straight years betwee

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Answer #1

There is an inverse relationship between land price and land rent – if one increases the other decreases.

At the rising price of land, demand for land rent decreases; it happens in the year 1980. Required demand curve is D0.

Since then the demand for land rent increases because of the decrease in land price. Subsequent demand curves are: year 1990, D1; year 1995, D2; and year 2001; D3. Land rent increases steadily in those periods.

2001 D3 1995 1990 1980

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