Rent control applies to about two-thirds of the private rental housing in New York City. Economic theory suggests that a below-equilibrium price established by rent control:
a. creates a surplus of rental housing.
b. promotes a rapid increase in the future supply of housing.
c. results in poor service and quality deterioration of many rental units.
d. leads to a reduction in housing discrimination against minorities.
c
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If Mr. McLean thinks the last dollar spent on bowling yields more satisfaction than the last dollar spent on hamburgers, and McLean is a utility-maximizing consumer, he should:
a. bowl less, so the marginal satisfaction from expenditures in this area will increase. b. spend more on hamburgers, so total satisfaction from that activity will increase. c. eliminate spending on hamburgers. d. bowl more and spend less on hamburgers.
The vertical axis of the aggregate demand-aggregate supply model measures the amount of
a. total employment. b. total final output. c. the price level. d. net exports.
The U.S. food and fiber industry
A) Includes farm input supply firms. B) Is one of the nation's most regulated sectors of the economy. C) Benefits from expansionary monetary policies. D) All of the above.
According to real business cycle models
A) the economy is normally operating below the natural rate of unemployment. B) unexpected changes in monetary policy are the major source of fluctuations in real GDP. C) the economy is normally at potential GDP. D) the long-run Phillips curve is negatively sloped.