Assuming that the long-run supply of housing is more _____ than the short-run supply, the imposition of binding rent controls will generally... a. Elastic; lead to a worsening of the housing shortage over time. b. Inelastic; lead to no significant change in the housing shortage. c. Inelastic; lead to a reduction in the housing shortage over time. d. Elastic; lead the price of rental housing to revert back to its equilibrium level. e. Elastic; lead to only a temporary housing shortage.
Assuming that the long-run supply of housing is more _____ than the short-run supply, the imposition of binding rent controls will generally... a. Elastic; lead to a worsening of the housing shortage over time. b. Inelastic; lead to no significant change in the housing shortage. c. Inelastic; lead to a reduction in the housing shortage over time. d. Elastic; lead the price of rental housing to revert back to its equilibrium level. e. Elastic; lead to only a temporary housing shortage.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Q3
Assuming that the long-run supply of housing is more _____ than the short-run supply, the imposition of binding rent controls will generally...
a.
Elastic; lead to a worsening of the housing shortage over time.
b.
Inelastic; lead to no significant change in the housing shortage.
c.
Inelastic; lead to a reduction in the housing shortage over time.
d.
Elastic; lead the price of rental housing to revert back to its equilibrium level.
e.
Elastic; lead to only a temporary housing shortage.
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