Asked by David Garcia on Apr 24, 2024
As shown in the figure given below,when a government sets a rent ceiling at $750 per month,the result is a(n) :
A) equilibrium in the market for rented apartments.
B) increase in supply of rented apartments.
C) shortage of rented apartments.
D) economic profit for the owners of rented apartments.
E) decrease in demand for rented apartments.
Rent Ceiling
A government-imposed limit on how high rents can go, aimed at keeping housing affordable.
Economic Profit
The difference between a firm's total revenues and its total costs, including both explicit and implicit costs, representing the additional value created by the firm beyond that required to compensate its resource suppliers.
Shortage
A condition where the demand for a product exceeds its supply in the market.
- Recognize the effects of government-imposed price controls on the supply and demand balance.
- Identify the consequences of price ceilings, such as shortages and maintenance issues in the housing market.
Learning Objectives
- Recognize the effects of government-imposed price controls on the supply and demand balance.
- Identify the consequences of price ceilings, such as shortages and maintenance issues in the housing market.