If the supply curve for housing has the normal positive slope, rent controls are likely to:
a. increase the quantity of available housing
b. improve the quality of available housing
c. create a larger shortage than if the supply curve were vertical.
d. help low-income families find suitable housing.
c
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Other things remaining the same, if a nation's real GDP rises, the demand to hold money:
a. Falls. b. Rises. c. Does not change.
A busy coffee shop hires an additional barista, enabling them to serve customers nearly twice as fast. The shop responds by hiring two more baristas. After this second round of hiring, the cost of serving each customer increases. What might explain this rise?
a. Diminishing returns of labor have set in. b. The company is experiencing economies of scale. c. Fixed costs are being spread over larger output. d. Total revenues have surpassed accounting costs.
How are technological advance and capital formation related?
What will be an ideal response?
Refer to Goods X and Y. Suppose the consumer is spending all of his income buying some of both goods. If the marginal value of X is greater than the relative price of X, how can the consumer improve his level of satisfaction?
Assume that good X is on the horizontal axis and good Y is on the vertical axis in the consumer-choice diagram. PX denotes the price of good X, PY is the price of good Y, and I is the consumer's income. Unless otherwise stated, the consumer's preferences are assumed to satisfy the standard assumptions. a. By purchasing more of both goods. b. By purchasing more of good X and less of good Y. c. By purchasing more of good Y and less of good X. d. The consumer cannot improve his level of satisfaction because he is at the optimum.