[Vocabulary] Land as commodity.

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Hello,

I would like to know how land could be classified as a commodity?


Thank you for your continuous help.
 

emsr2d2

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Hello,
I would like to know how land could be classified as a commodity. (This is not a question so shouldn't end with a question mark.)

Thank you for your [strike]continuous[/strike] help.

Are you asking us to explain how land can be classed as a commodity, or are you asking us if the sentence is grammatically correct? You need to make it clear what you're actually asking.
 
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I want to know why land is classified under commodity.
Could you please explain?

Thanks for the corrections.
 

emsr2d2

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What makes you think that land is not a commodity? What is your understanding of the word "commodity"?
 
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Commodity is something that could be sold or bought.
Keeping this in mind, at this point it was OK to call it a commodity. Later I found out that commodity has one particular quality which is "its price remain fixed , no matter where you buy it".
But every piece of land has a price which is different from any other piece of land. Often the prices of two adjacent piece of land vary.
 
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teechar

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I would not classify land as a commodity.

There are three conditions that must be met to call something a commodity. It must be:

1. Something bought or sold at a price which varies according to supply and demand. By this definition, it might be tempting to think of land as a commodity.

2. Something produced in volume according to the prevailing market price. If the price is high, then production increases. If the price drops, production is reduced accordingly. Land definitely does not fit here. Certainly the price and availability of land for purchase fluctuates according to price, but there is no production, and volume is never high.

3. It must be fungible: defined by the market as the same no matter where or by whom it was produced. A ton of soybeans is a ton of soybeans, whether they grew in Brazil or in America. A barrel of oil is a barrel of oil, whether it came out of the ground in Canada or Venezuela. In no way could land be considered fungible.
 
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