Rent control is an example of a price ceiling. Which of the following problems must be addressed under a rent control program?
a. what to do with the surplus of rental units
b. how to subsidize renters so that they can afford to pay the higher rents
c. how to decrease the quantity of rental units to the equilibrium level
d. whether the opportunity cost of rental units equals the competitive market price
e. how to allocate scarce rental units
E
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The following are common errors students make when discussing supply and demand. What is the mistake in each? a. At equilibrium, demand equals supply. b. The quantity of demand is greater than the quantity of supply. c. They move along the line from both ends to an equilibrium in the middle. d. The increase in demand causes an increase in supply.
What will be an ideal response?
An income effect
A. is measured as the change in prices over time. B. is not possible when people are unemployed. C. requires interest rates to remain constant. D. is the change in the quantity demand due to the fact that real income changes when prices change.
Adopting the Single European Act had broad popular support; the Treaty on European Union was more controversial
Indicate whether the statement is true or false
If the average interval between firms' price adjustments is relatively short
A. a reduction in aggregate demand will cause a relatively long-lived reduction in real Gross Domestic Product (GDP). B. an increase in aggregate demand will cause a relatively long-lived increase in real Gross Domestic Product (GDP). C. an increase in aggregate demand will cause a relatively short-lived increase in real Gross Domestic Product (GDP). D. a reduction in aggregate demand will cause a relatively long-lived increase in real Gross Domestic Product (GDP).