2. Suppose that college students in your town persuaded thetown council to enact a law setting the maximum price forrental housing at $400 per month. Will this help or hurt col-lege students who rent housing? In your answer, address howthis price ceiling will affect (a) the quality of rental housing;(b) the amount of rental housing available; (c) the incentiveof landlords to maintain their properties; (d) the amount ofracial, gender, and other types of discrimination in the localrental housing market; (e) the ease with which students willbe able to find housing; and, finally, (f) whether a black mar-ket for housing would develop.5

(a) Quality of rental housing:Without the ability to charge market-rate rents, landlords would have…

Answered: 2. Suppose that college students in…

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter4: Demand And Supply: Applications And Extensions

Section: Chapter Questions

Problem 2CQ

See similar textbooks

Similar questions

A recent study found that the demand and supply schedules for financial calculators are as follows: Price/calculators Quantity Demanded Quantity Supplied 20 160 40 40 140 60 60 120 80 80 100 100 100 80 120 120 100 Co an Coll 80 60 40 D. 20 40 60 80 100 120 140 160 a) Determine: Price of Equilibrium_ and Quantity of Equilibrium b) Determine the effect of $60 Price Ceiling. Is it binding? Why? Will it cause Shortage or Surplus? And by how much? c) Determine the effect of $120 Price Floor. Is it binding? Why? Will it cause Shortage or Surplus? And by how much?
1) Listen After weather system Derecho produccrs were accused of pricé gouging because bottled water skyrocketed in price. Consumers clamored for price controls to be implemented to keep the price of bottled water at pre- Derecho levels. What are the economic conscquences of the government placing a price ceiling on bottled water at the previqus price? Please explain.
Refer to the figure below. If the government sets a price ceiling of $6, 18 16 14 12 10 8 6 4 2 D₁ 24 6 8 10 12 14 16 18 there would be a shortage of 14 units. O there would be an excess supply of 6 units. O There would be a shortage of 4 units. consur ers would demand 14 units.
Which of the following would be the most likely result of a binding price ceiling imposed on the market for rental cars? Select one: O a. slow replacement of old rental cars with newer ones Ob. frequent rental programs such as "Rent nine times and the tenth rental is free!" O c. free gasoline given to people as an incentive to a rent a car O d. enhanced maintenance programs to promote the high quality of the cars Next page IMG_7969.jpeg UPEG
Price floors and ceilings are meant to help correct a market failures. The issue becomes when the price floors and ceilings themselves becoming the market failure. Rent control is meant to prevent landlords from taking advantage of tennets with extreme prices. The issue is it creates the situation in the below graph. When the below scenario is occuring, which point is market equilibrium and which point is demand at the price of $800? Monthly Rent Per Unit (dollars) OB and E OB and A OE and A E and B 1,600 1,200 800 400 Rent ceiling 0 Rent ceiling B 2 C Shortage of 4 million rental units Quantity demanded 6 CAUSATION CHAIN 8 10 Quantity of Rental Units (millions per month) S = MC exceeds quantity supplied D = MB Persistent shortage
What is the effect of a price ceiling on the quantity demanded of the product? What is the effect of a price ceiling on the quantity supplied? Why exactly does a price ceiling cause a shortage?
Would usury laws help or hinder resolution of a shortage in financial markets?
What is the relationship between quantity Demanded and quantity supplied at equilibrium? What is the relationship when there is a shortage? What is the relationship when them is a surplus?
Why would a free market mar operate at a quantity greater than the equilibrium quantity? Hint: What would be required for at transaction to occur at that quantity?
e Which of the following statements is true? Select one: O a. Microeconomics studies producer behavior, whereas macroeconomics studies consumer behavior. O b. Microeconomics studies consumer behavior, whereas macroeconomics studies producer behavior O c. Microeconomics studies inflation and opportunity costs, whereas macro-economics studies unemployment and marginal costs. O d. Microeconomics studies behavior of individual households and firms, whereas macroeconomics studies national aggregates. here to search O Time left 0:52 W Next pag
300 400 500 Quantity (millions of gallons per yeart 100 200 600 An upper limit to the quantity of a good that may be produced in a specific period is called Select one: O a. production quota O b. import quota O c. price ceiling O d. price floor 5) 3) Price (dollars per gollon)
Suppose that the demand curve for wheat is Q500 - 10p and that the supply auve is O 10p What are the efects of a subnidy (negative tax) ofs4 per unit paid to produoers on the equlibrium, govemment. subsidy cost, consumer surplus (CS), producer surplus (PS), weifare (W, and deadweight loss (DWL)? Wih the subsidy, the equibrium price is Sand the equilibrium quantity isunits. (Enter your responses as whole numbers) The cost of the subsidy to the govermment is S (Enter your response as a whole number) The change in consumer surplus (ACS) is S (Enter your response as a whole number.) The change in producer surplus (APS) is S Enter your response as a whole number) The change in welttare (AW) is S (Enter your reaponse as a whole number and include a minus sign i necessary Deadweight loss is S (Ender your response as a whole number)

SEE MORE QUESTIONS

Recommended textbooks for you

Economics: Private and Public Choice (MindTap Cou…

Economics

ISBN:

9781305506725

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Microeconomics: Private and Public Choice (MindTa…

Economics

ISBN:

9781305506893

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Macroeconomics: Private and Public Choice (MindTa…

Economics

ISBN:

9781305506756

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Economics: Private and Public Choice (MindTap Cou…

Economics

ISBN:

9781305506725

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Microeconomics: Private and Public Choice (MindTa…

Economics

ISBN:

9781305506893

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Macroeconomics: Private and Public Choice (MindTa…

Economics

ISBN:

9781305506756

Author:

James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:

Cengage Learning

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Principles of Macroeconomics (MindTap Course List)

Economics

ISBN:

9781285165912

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Principles of Economics, 7th Edition (MindTap Cou…

Economics

ISBN:

9781285165875

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS