Using appropriate diagram, show how interaction of demand and supply curve in land market leads to determination of equilibrium rent.

In a typical land market, the equilibrium rent is determined at the point where the demand for land meets the supply of land. Here's how it can be visualized:

1. Demand Curve for Land: This curve slopes downwards from left to right, indicating that at lower rents, a larger quantity of land is demanded. This is because as the cost of renting land decreases, more individuals or businesses can afford to rent land for various purposes.

2. Supply Curve for Land: The supply curve for land is often depicted as vertical (perfectly inelastic) because the total amount of land available is fixed and cannot be increased in response to changes in rent.

3. Equilibrium Rent: The point where the demand curve intersects the supply curve represents the equilibrium rent. At this rent level, the quantity of land that property owners are willing to rent out equals the quantity that renters are willing to rent.

4. Diagram Description: In a diagram, the vertical supply curve intersects the downward-sloping demand curve at a certain point. The rent at this intersection point is the equilibrium rent, and the corresponding quantity is the equilibrium quantity of land rented.
   

5. Adjustments to Equilibrium: If the rent is set above the equilibrium level, there will be an excess supply of land (surplus), as fewer people are willing to rent at higher prices. Conversely, if the rent is below equilibrium, there will be excess demand (shortage), as more people want to rent land at lower prices. In both cases, market forces will tend to push the rent back towards the equilibrium level.

In summary, the equilibrium rent in the land market is determined at the point where the quantity of land people are willing to rent equals the quantity property owners are willing to rent out, and this is found at the intersection of the demand and supply curves for land.