Imagine a city with a severe housing shortage, leading to skyrocketing rental prices. The city government decides to implement a strict price ceiling on apartment rents, capping them at a level significantly below the market equilibrium rent. Analyze the potential consequences of this price ceiling on both renters and landlords in the short term. Use supply and demand diagrams to illustrate your points and discuss any potential unintended outcomes. Additionally, consider whether this policy is likely to address the housing shortage effectively.

 

#2. Use a graph to illustrate the impact of a tax on the following markets. Explain who bears the tax burden.

1. Tax on property
2. Tax on cigarettes
3. Tax on sale of medical devices that are bought by hospitals
4. Income tax

#3. Imagine two cities with different labor markets for unskilled workers. In City A, the market wage rate for workers is $13/hour. In City B, the market wage rate for similar workers is $9/hour. If the state enacts a minimum wage law of $11/hour, which of the two cities gets impacted and how? Assume that the cities are in the same state but they are 300 miles apart.

#4 Not everyone is a SWIFTie. However, no one can argue with the enormous impact Taylor Swift is having on the US economy right now. The following article details a few examples of the impact of Taylor Swift on the economy, highlighting the money generated by her current tour.

Time Magazine Article

This discussion requires students to pick any one industry that has been affected by Taylor Swift. Discuss how industries are affected by her tour, or merchandizing, or her endorsement of brands. You need to be specific. There are a couple of ways to do this properly:

• For example, pick a city that she toured and discuss how that affected hotels, transportation, and restaurants in that city. Google some local news articles detailing the tour and how that affected some of the businesses in that city.
• You can also talk about how you would use her image/brand to your advantage as an industry leader.
• You can also ask which industries might stay away from her brand, and why.
• You cannot give generic answers (firms increase their profits, or revenue).
• Pick specific markets and industries (either cities, or companies, or markets that are related to a global environment)

Again, I want students to think critically and pick specific examples.