N1

2) Suppose that the poor households of city H are enrolled in a voucher program. You are a middle-income renter in the city.

a) Will you be helped or harmed by the allowance program? Why?

b) If you will be harmed, what variables determine how much you will be harmed? In other words, what are the relevant elasticities, and how does the cost you incur vary with them?

c) How would your answer to (a) change if you owned your home?