Rising Kentucky Land Prices Make Renting Attractive to Producers Land prices in Kentucky are steadily rising. Cities and towns are experiencing substantial growth.
Land close to cities is being eyed for development and as a result it is overvalued as farmland.
More and more farmers are renting rather than buying because it is often cheaper to rent.

a. Explain why the price of land in Kentucky is rising.
b. Why are farmers making the decision to rent?
In your answer include a discussion of present value.
c. Draw a graph to illustrate your answer to part
(a).