4. Effects of Rent Control Rent controls force landlords to price property below the equilibrium price level. An effect of this is to create a shortage (excess demand) of rental property, as the quantity of rental property demanded is greater than the quantity supplied at that price. When legislation prevents landlords from charging market rents, what can happen in the long run as a result? Check all that apply O Non-price methods of rationing emerge. O The future supply of rental housing units increases. O Efficient use of housing space results. O Landlords earn lower profits from renting housing units, but the rent charged has no effect on either the quanbity or quality of rental units.

4. Effects of Rent Control Rent controls force landlords to price property below the equilibrium price level. An effect of this is to create a shortage (excess demand) of rental property, as the quantity of rental property demanded is greater than the quantity supplied at that price. When legislation prevents landlords from charging market rents, what can happen in the long run as a result? Check all that apply O Non-price methods of rationing emerge. O The future supply of rental housing units increases. O Efficient use of housing space results. O Landlords earn lower profits from renting housing units, but the rent charged has no effect on either the quanbity or quality of rental units.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The point of equilibrium in the market is important because a. All of these. O b. A seller sells the product at equilibrium Price is fixed for a product at the equilibrium O d. A buyer purchases the product at equilibrium
2. Consider a competitive market for which the quantities demanded and supplied (per year) at various prices are given as follows: Demand (Millions) Supply (Millions) Price (Dollars) 60 80 100 120 22 20 18 16 14 16 18 20 Calculate the price elasticity of demand when the price is $80 and when the price is $100.
2. Suppose that a market's demand curve is given by: Price Quantity $15 6 $14 8 $13 10 $12 12 $11 14 $10 16 $9 18 $8 20 $7 22 $6 24 $5 26 $4 28 Suppose that the price start at $6, and then drops by $2. What is the elasticity of demand over the range of this change? Ans:
1. Supposed that UMA Condominiums are an ordinary good and demand for Condominiums is inelastic. What is the effect on Nagenyos Consumer Surplus if there is a decrease in price of Condominiums? Explain. 2. Based from your answer in the questions pertaining to the supply of Condominiums in response to the demand of Nagenyos, enumerate at least two (2) possible effects of the determinants of demand ( (a) price, (b) income, (c) price of related goods like apartments and residential houses, and (d) consumer taste and expectation) and determinants of supply ( (a) flexibility of inputs, (b) mobility of inputs, (c) ability to produce substitute and (d) time ).
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Question 21
3. Effects of rent control Rent controls require that landlords set apartment prices below the equilibrium price level. An immediate effect is an apartment rental shortage (excess demand for apartments), because at the regulated price the quantity of apartments demanded is greater than the quantity supplied. When landlords are prevented by cities from charging market rents, which of the following listed outcomes are common in the long run? Check all that apply. The quantity of available rental housing units falls. Landlords earn lower profits from renting housing units, but the rent charged has no effect on either the quantity or quality of rental units. Nonprice methods of rationing emerge. Efficient use of housing space results.
3. The demand and supply curves of pens in the city of Nairobi are represented by the following function:- Required: Quantity demanded Qd=20-4p Quantity supplied Qs = -10 + 6p Where p is the price per pen. Calculate the equilibrium price and quantity. Examine the effect of a price ceiling set by the authorities at ii. Shs.2.00/= per pen.
Price $20- 18- 16- 14 12 10 8 6- 4 2- 0 10 20 30 40 50 90 100 Quantity Refer to the Figure 4-3. If the price in this market is currently $14, what would happen? O a. There would be a shortage of 20 units so producers would increase production. O b. There would be a surplus of 20 units and the price would tend to fall. O c. There would be a shortage of 40 units so producers would increase production. O d. There would be a surplus of 40 units and the price would tend to fall.
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Figure 7-4 Price P₂ P₁ o с D 9₂ B E 82 Quantity Refer to Figure 7-4. What will NOT occur when the price falls from P2 to P1? a. The total quantity sold in the market increases. b. The sellers who still sell the good are worse off because they now receive less. OC. The total cost of what is now sold by sellers is actually higher. X d. Producer surplus would fall by area A + B.
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