Question 5

Questions 5 to 7refer to the following.

• Instruction: To answer the questions, refer to the attached labeled "rent ceiling." (the picture below)
• Scenario: Assume that the graph characterizes the market for rental apartments in a certain city. The vertical axis pertains to the monthly rent (measured in '00 dollars) and the horizontal axis pertains to the number of apartments.

Question 5 . What are the equilibrium rent and equilibrium quantity of rental apartments?

After choose are choices, please pick one of them

Rent

[ Choose ]15$50020$250

Quantity

[ Choose ]15$50020$250

Question 6

Suppose that the government places a rent ceiling of $300 a month. Under this scenario:

1. What is quantity demanded for rental apartments?
2. What is quantity supplied of rental apartments?
3. Would there be a surplus or shortage of apartments for rent?
4. How many apartments are in surplus or shortage, if any?

Quantity demanded QD

[ Choose ]102021159We have a surplus of apartmentsWe have a shortage of apartments12

Quantity supplied QS

[ Choose ]102021159We have a surplus of apartmentsWe have a shortage of apartments12

Do we have a surplus or shortage of apartments?

[ Choose ]102021159We have a surplus of apartmentsWe have a shortage of apartments12

How many apartments?

[ Choose ]102021159We have a surplus of apartmentsWe have a shortage of apartments12

Question 72 pts

How many apartments will be rented if the government places a rent ceiling of $700 a month, instead of $300? Explain.

Note: Unlike in the previous rent ceiling of $300, observe that this rent ceiling of $700 is higher than the equilibrium rent. Recall our discussion that when a rent ceiling is placed above the equilibrium, it will not have an effect on the market.

How many?

[ Choose ]A rent ceiling placed above equilibrium is binding20A rent ceiling placed above equilibrium is not binding15

Explain

[ Choose ]A rent ceiling placed above equilibrium is binding20A rent ceiling placed

rent ceiling Page I of 1 Market for Rental Apartments Assume that the graph below channelcrises the market for rental apartments in a certain city The vertical mom portahis to the monthly rent (measured in "(0 dollar) and the horimosul won portions to the number of apartments