Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 4, Problem 4.3.13PA
Sub part (a):
To determine
The impact of rent control on the rental apartments.
Sub part (b):
To determine
Shortage or surplus of apartments due to rent control.
Sub part (c):
To determine
The
Sub part (d):
To determine
The Maximum chargeable and willing to pay price of apartments.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
What does rent control do to the pricing and supply of apartment,
units? According to the Wall Street Journal, "Rent control
disproportionately subsidizes the affluent. A Harvard University
study in the late 1980s found that rent-controlled apartments
were in some of the city's best neighborhoods, that 94% of their
tenants were white, and roughly three-quarters of their
occupants were families without children." Do you think NYC
should maintain rent control?
K
Use the information in the following table (and in the graph) on the market for apartments in Bay
City to answer the following questions.
Rent
$300
400
500
600
700
800
Equilibrium rent is $
responses as integers.)
Quantity
Demanded
325,000
300,000
275,000
250,000
225,000
200,000
Quantity
Supplied
175,000
200,000
225,000
250,000
275,000
300,000
In the absence of rent control, what is the equilibrium rent and the equilibrium quantity of
apartments rented?
and the equilibrium quantity is thousand apartments. (Enter your
Price (dollars per month)
1000-
900-
800-
700-
600-
500-
400-
300-
200-
100-
0+
0
Supply
Price Ceiling
Demand
50 100 150 200 250 300 350 400
Quantity (apartments per month in thousands)
Q
Q
You have been given the following information about the housing market for two-
bedroom rental units in Vancouver:
Rent ($ per
Quantity Demanded (per
month)
Quantity Supplied (per
month)
month)
1,100
20,000
1,200
15,000
5,000
1,300
10,000
10,000
1,400
5,000
15,000
1,500
2,500
20,000
1,600
1,500
25,000
a. Draw a supply and demand graph to illustrate the housing market above.
Answer:
b. What is the equilibrium rental price and the equilibrium quantity of
housing?
Answer:
c. Suppose that a price ceiling of $1,200 rent per month is imposed in the
Vancouver housing market, what will be the effect of this on housing
market in Vancouver?
Answer:
Chapter 4 Solutions
Microeconomics (7th Edition)
Ch. 4.A - Prob. 1RQCh. 4.A - Prob. 2RQCh. 4.A - Prob. 3RQCh. 4.A - Why would economists use the term deadweight loss...Ch. 4.A - Prob. 5PACh. 4.A - Prob. 6PACh. 4.A - Prob. 7PACh. 4.A - Prob. 8PACh. 4.A - Prob. 9PACh. 4 - Prob. 1TC
Ch. 4 - Prob. 2TCCh. 4 - Prob. 4.1.1RQCh. 4 - Prob. 4.1.2RQCh. 4 - Prob. 4.1.3RQCh. 4 - Prob. 4.1.4RQCh. 4 - Prob. 4.1.5PACh. 4 - Prob. 4.1.6PACh. 4 - Prob. 4.1.7PACh. 4 - Prob. 4.1.8PACh. 4 - Prob. 4.1.9PACh. 4 - Prob. 4.1.10PACh. 4 - Prob. 4.1.11PACh. 4 - Prob. 4.1.12PACh. 4 - Prob. 4.1.13PACh. 4 - Prob. 4.1.14PACh. 4 - Prob. 4.2.1RQCh. 4 - Prob. 4.2.2RQCh. 4 - Prob. 4.2.3PACh. 4 - Prob. 4.2.4PACh. 4 - Prob. 4.2.5PACh. 4 - Prob. 4.2.6PACh. 4 - Prob. 4.2.7PACh. 4 - Prob. 4.2.8PACh. 4 - Prob. 4.2.9PACh. 4 - Prob. 4.2.10PACh. 4 - Prob. 4.3.1RQCh. 4 - Prob. 4.3.2RQCh. 4 - Prob. 4.3.3RQCh. 4 - Prob. 4.3.4RQCh. 4 - Prob. 4.3.5PACh. 4 - Prob. 4.3.6PACh. 4 - Prob. 4.3.7PACh. 4 - Prob. 4.3.8PACh. 4 - Prob. 4.3.9PACh. 4 - Prob. 4.3.10PACh. 4 - Prob. 4.3.11PACh. 4 - Prob. 4.3.12PACh. 4 - Prob. 4.3.13PACh. 4 - Prob. 4.3.14PACh. 4 - Prob. 4.3.15PACh. 4 - Prob. 4.3.16PACh. 4 - Prob. 4.3.17PACh. 4 - Prob. 4.3.18PACh. 4 - Prob. 4.3.19PACh. 4 - Prob. 4.4.1RQCh. 4 - Prob. 4.4.2RQCh. 4 - Prob. 4.4.3RQCh. 4 - As explained in the chapter, economic efficiency...Ch. 4 - Prob. 4.4.5PACh. 4 - Prob. 4.4.6PACh. 4 - Prob. 4.4.7PACh. 4 - Prob. 4.4.8PACh. 4 - Prob. 4.4.9PACh. 4 - Prob. 4.4.10PACh. 4 - Prob. 4.2CTE
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- The table shows the demand and supply schedules for on-campus housing. If the college puts a rent ceiling on rooms of $750 a month, rent is $ and the number of rooms rented is. The on-campus housing market is Rent (dollars per month) 500 550 600 650 700 750 Quantity demande 2.500 2,250 2,000 1,750 1,500 1,250 (rooms) Quantity supplied 2,000 2,000 2,000 2,000 2,000 2,000arrow_forwardSuppose that the demand and supply schedules for rental apartments in the city of Gotham are as given in the following table. Apartments Demanded Apartments Supplied 15,000 12,500 10,000 7,500 5,000 Monthly Rent $2,500 2,000 10,000 12,500 15,000 1,500 1,000 500 17,500 20,000 Instructions: Enter your answers as a whole number. a. What is the market equilibrium rental price per month and the market equilibrium number of apartments demanded and supplied? Market equilibrium rental price = $ Market equilibrium quantity = apartments b. If the local government can enforce a rent-control law that sets the maximum monthly rent at $1,500, will there be a surplus or a shortage? (Click to select) ♥ Of how many units? apartments per month How many units will actually be rented each month? apartments c. Suppose that a new government is elected that wants to keep out the poor. It declares that the minimum rent that landlords can charge is $2,500 per month. If the government can enforce that price…arrow_forwardThe following graph shows the daily market for extra-large cardboard boxes in New York City. Fill in the price and the total, marginal, and average revenue Vesoro earns when it produces 0, 1, 2, or 3 boxes each day. Quantity (Boxes) Price (Dollars per box) Total Revenue (Dollars) Marginal Revenue (Dollars) Average Revenue (Dollars per Box) 0 0 1 2 3arrow_forward
- Producer surplus is the difference between the price consumers pay and the supply curve The graph on the right depicts the supply and demand curves for a market in competitive equilibrium 1.) Using the triangle drawing tool, highlight the area on the graph that represents producer surplus. Label this area 'PS". Carefully follow the instructions above and only draw the required object. Using your graph, calculate the producer surplus in this market Producer surplus is (Round your response to two decimal places) Price Quantity D COOarrow_forwardThe table shows the demand and supply schedules for on-campus housing. If the college puts a rent ceiling on rooms of $350 a month, rent is $7 and the number of rooms rented is 4. The on-campus housing market is inefficient Rent (dollars per month) 250 275 300 325 350 375 Quantity demanded 2,500 2,250 2,000 1,750 1,500 1,250 (rooms) Quantity supplied 2,000 2,000 2,000 2,000 2,000 2,000 Nextarrow_forwardPRICE [Dolars per laptop) The following diagram shows supply and demand in the market for laptops. 150 Demand 135 120 105 90 75 60 45 30 15 Supply ° 1 0 35 70 105 140 175 210 245 280 QUANTITY (Millions of laptops) 315 350 Fill in the following blanks with integer values: The market price is The market quantity is The consumer surplus is 4200 The producer surplus is 4200 The total surplus is 8400 A price ceiling is imposed at $60. The market price is now There is now a (surplus/shortage/none) Is there deadweight loss (yes/no)? of what amount? How much if any? If a price floor is implemented at $65, would it be binding? (yes/no)arrow_forward
- The table shows the demand and supply schedules for on-campus housing. If the college puts a rent ceiling on rooms of $600 a month, what is the rent, how many rooms are rented, and is the on-campus housing market efficient? CELEB If the college puts a rent ceiling on rooms of $600 a month, the rent is $ and the number of rooms rented is Rent (dollars per month) 500 550 600 650 700 750 Quantity demanded 5,000 4,500 4,000 3,500 3,000 2,500 (rooms) Quantity supplied 4,500 4,500 4,500 4,500 4,500 4,500arrow_forwardOne of the discussions you've participated in so far was "Understanding Market Forces".One market you analyzed was the market for organic produce. Summarize in your own words the demand and supply changes going on in that market, as discussed in the article that you read. What is the net effect of those changes on the market for organic produce?arrow_forwardThe graph shows the supply curve of candles and the market price of a candle. What is the quantity of candles sold? Calculate the producer surplus, the total revenue from the candles, and the cost of producing them. *** Draw a point to show the quantity of candles sold and the price. Draw a shape that represents the producer surplus. The producer surplus is $ The total revenue is $. The total cost of producing 20 candles is $ 50.00 40.00- 30.00 20.00 10.00- 0.00+ 0 Price (dollars per candle) S Market price 40 60 20 Quantity (candles per day) >>> Draw only the objects specified in the question. 80 Qarrow_forward
- $30 a week boost to minimum wage The government has increased the minimum wage by $30 a week to $570 a week. Unions wanted a $35 a week increase, but employers argued that that level of increase was unaffordable and would send smaller firms to the wall. Source: ABC Australia, February 11, 2 On a graph of the market for low-skilled labor, show the effect of the $30 a week increase in the minimum wage on employment of low-skilled labor. The graph shows the market for low-skilled labor. The y-axis label is and the x-axis label is Draw a point on the market supply curve and label it S. Draw a point on the market demand curve and label it D. Draw a point to show the wage rate and workers employed if the minimum wage is set at: 1) $540 a week. Label the point 1. 2) $570 a week. Label the point 2. Draw an arrow to show the change in employment from the increase in the 590- 580- 570- 560- 550- 540- 530- 520- 510- 980 Y 990 1000 X 1010 1020 >>> Draw only the objects specified in the question.…arrow_forward$30 a week boost to minimum wage The government has increased the minimum wage by $30 a week to $570 a week. Unions wanted a $35 a week increase, but employers argued that that level of increase was unaffordable and would send smaller firms to the wall. Source: ABC Australia, February 11, 2 On a graph of the market for low-skilled labor, show the effect of the $30 a week increase in the minimum wage on employment of low-skilled labor. The graph shows the market for low-skilled labor. The y-axis label is Workers per week Workers per week and the x-axis label is Draw a point on the market supply curve and label it S. Draw a point on the market demand curve and label it D. Draw a point to show the wage rate and workers employed if the minimum wage is set at: 1) $540 a week. Label the point 1. 2) $570 a week. Label the point 2. Draw an arrow to show the change in employment from the increase in the M 590- 580- 570- 560- 550- 540- 530- 520- 510- 980 Y 990 1000 X 1010 1020 >>> Draw only the…arrow_forwardThe following diagram shows supply and demand in the market for tablets. Use the black point (plus symbol) to indicate the equilibrium price and quantity of tablets. Then use the green point (triangle symbol) to fill the area representing consumer surplus, and use the purple point (diamond symbol) to fill the area representing producer surplus. 250 Demand 225 Equilibrium 200 A 175 150 Consumer Surplus 125 100 Producer Surplus 75 50 25 Supply 35 70 105 140 175 210 245 280 315 350 QUANTITY (Millions of tablets) Total surplus in this market is $ million. PRICE (Dollars per tablet)arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Microeconomics: Principles & PolicyEconomicsISBN:9781337794992Author:William J. Baumol, Alan S. Blinder, John L. SolowPublisher:Cengage Learning
Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Microeconomics: Principles & Policy
Economics
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:Cengage Learning
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co