PRICE CONTROLS

Read the questions and instruction carefully. Show all necessary steps and reasonings that lead to your answers.

1) With the help of supply-demand diagrams, illustrate a binding and a non-binding price ceiling respectively . Label your diagrams carefully.

2) With the help of supply-demand diagrams, illustrate a binding and a non-binding price floor respectively . Label your diagrams carefully.

3) Is rent control a price ceiling or a price floor? In a lot words, state and explain AT LEAST TWO cons and/or limitations ofrent controls.