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Be able to write out the profit equation used to illustrate the willingness to pay for rent for firms based on price of good sold,
Be able to write out the profit equation used to illustrate the willingness to pay for rent for firms based on price of good sold, quantity of good sold (as a function of distance), average cost to produce, transportation costs and required profit. Be able to explain economically and show mathematically how the slope of a firm's bid rent curve (decline in WTP as distance from market/CBD increases) is related to loss revenues and increased transportation costs)
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