Asked by Mireille Mathieu Ebode Nkoudou on May 19, 2024
Verified
If the government imposes a ceiling price on apartment rents,we would expect to observe all of the following except one.Which of these is the exception?
A) An increase in the number of new apartment complexes being built
B) Long waiting lists for apartment seekers
C) Lower maintenance of existing apartments
D) An increase in the rent for the apartments
E) A shortage of rented apartments
Ceiling Price
Ceiling price is a legally imposed maximum price on goods or services, above which transactions cannot legally occur, often implemented to prevent price gouging during shortages.
Maintenance
The upkeep and repair of machinery, equipment, and buildings to ensure their optimum working condition.
Shortage
A market condition occurring when the demand for a product or service exceeds the supply available at a specific price.
- Perceive the outcomes of government-implemented price controls on the equilibrium of supply and demand.
- Understand the ramifications of setting price ceilings, like shortages and preservation difficulties in the housing industry.
Verified Answer
TS
Tamara SweisMay 23, 2024
Final Answer :
A
Explanation :
Imposing a ceiling price on apartment rents typically discourages developers from building new apartment complexes because the return on investment is lower. This is contrary to the effects listed in the other options, which are direct consequences of rent control policies.
Learning Objectives
- Perceive the outcomes of government-implemented price controls on the equilibrium of supply and demand.
- Understand the ramifications of setting price ceilings, like shortages and preservation difficulties in the housing industry.