Describe a scenario of a family leasing a rent-control apartment. In your description, show the various pros and cons of rent control.
What will be an ideal response?
Scenarios will vary, but should show a thorough understanding of the pros and cons of rent control. For example, a family with a husband, wife, and four kids are tenants in a rent-control apartment. The husband works full-time as a busboy in a restaurant, and the wife works part-time. The family considers themselves lucky because they can afford the rent despite their low income. In fact, they have lived in this apartment for 6 years and have no plans to move. However, the apartment is constantly in a state of disrepair. The landlord feels that because of the low rent, he can’t afford to make repairs. So the husband and wife do many of their own repairs. They also notice that the landlord appears to avoid renting to certain minority groups. Because of the low rents, he has many possible renters to choose from, so he can avoid people he may have bias against.
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If the ________ curve is relatively more unstable than the ________ curve, an interest rate target is preferred
A) IS; IS B) IS; LM C) LM; IS D) LM; LM
Which of the following is both a store of value and a common medium of exchange?
a. corporate bonds b. mutual funds c. checking account balances d. All of the above are correct.
Why is the supply of loanable funds often relatively inelastic with respect to interest rates?
What will be an ideal response?
Government policies that encourage savings
A) reduce interest rates. B) increase interest rates. C) have no effect on interest rates. D) lower the net present value of all investments.