2/ The cities of Francistown and Nalady are five miles apart. Francistown enacts a rent control law that puts a ceiling on rents well below their equilibrium market value. Predict the short-run impact of this law on the competitive equilibrium rent in Nalady, which does not have a rent control law.

2/ The cities of Francistown and Nalady are five miles apart. Francistown enacts a rent control law that puts a ceiling on rents well below their equilibrium market value. Predict the short-run impact of this law on the competitive equilibrium rent in Nalady, which does not have a rent control law.

Principles of Macroeconomics (MindTap Course List)

7th Edition

ISBN:9781285165912

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 7PA

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Question

2/ The cities of Francistown and Nalady are five miles apart. Francistown enacts a rent
control law that puts a ceiling on rents well below their equilibrium market value. Predict
the short-run impact of this law on the competitive equilibrium rent in Nalady, which does
not have a rent control law.

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