After the imposition of a price ceiling (rent control), area B represents: Monthly rent (per apartment) $1,400 1,200 1,000 A 800 600 B Before Rent Control After Rent Control S Monthly rent (per apartment) S $1,400 1,200 1,000 A 800 Price ceiling 600 C.. B D D D 0 1.6 1.8 2.0 2.2 2.4 0 1.6 1.8 2.0 2.2 2.4 Quantity of apartments (millions) Quantity of apartments (millions) consumer surplus. producer surplus. consumer surplus transferred from producers. deadweight loss.

•A market has the market supply equation as P = ½Q andthe demand equation as P = 6 ½Q, where P is price indollars and Q is the quantity.•••(a) Solve for the equilibrium price, the equilibrium quantity,the consumer surplus and the producer surplus in themarket. Support your answers with a suitable marketdiagram.•••(b) If there is a price ceiling of $2, compute the consumersurplus, producer surplus and the deadweight loss in themarket. Support your answers with a suitable marketdiagram.

The diagram below shows the market for rental apartments. Suppose the government imposes a rent control law that sets the maximum monthly rent at $400. a Identify the quantity of apartments demanded and the quantity of apartiments supplied at a controled rent.of $400 Instructions: Use the tool provided 'Op' to indicate the quantty demanded when there is a controted rental pnce of $400 Then use the tool provided Qs'to indicate the quantity supplied when there is a controled rental price of $400 $1600 Toole eBoo $1,400 Suoply $1.200 .000 S800 $600 $400 Demand S200 50 100 150 200 250 300 350 400 450 500 Quantity of housing (unita) Suppose that everyone who had a lease for a rent-control unit sublet that unit in a shadow market at the highest price they could receive b. In this case, the highest price they could charge is a rental price of (Cick to select)

Price floors and ceilings are meant to help correct a market failures. The issue becomes when the price floors and ceilings themselves becoming the market failure. Rent control is meant to prevent landlords from taking advantage of tennets with extreme prices. The issue is it creates the situation in the below graph. When the below scenario is occuring, which point is market equilibrium and which point is demand at the price of $800? Monthly Rent Per Unit (dollars) OB and E OB and A OE and A E and B 1,600 1,200 800 400 Rent ceiling 0 Rent ceiling B 2 C Shortage of 4 million rental units Quantity demanded 6 CAUSATION CHAIN 8 10 Quantity of Rental Units (millions per month) S = MC exceeds quantity supplied D = MB Persistent shortage