Calculating and Explaining Market Shortage
Consider a city's rental market where, initially, 10,000 apartments are rented at a price of $1,500 per month, which is the equilibrium point. Following the arrival of a large new employer, the quantity of apartments demanded at the $1,500 price point increases to 14,000. At this same price, landlords are still only willing to supply 10,000 apartments. First, calculate the size of the excess demand. Second, explain why the number of apartments actually rented remains at 10,000 in the immediate term.
0
1
Tags
Social Science
Empirical Science
Science
Economy
Economics
CORE Econ
Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
Related
Calculating Excess Demand in a Rental Market
Consider a rental housing market that is initially in equilibrium, with 10,000 apartments being rented for $1,200 per month. A new major employer moves into the city, causing a significant increase in the number of people seeking to rent apartments. If the rental price remains at the original $1,200 per month, which of the following statements accurately describes the immediate state of the market?
Consider a rental housing market where the price is initially at a level where the quantity of apartments demanded equals the quantity supplied. If there is a sudden increase in the number of people wanting to rent apartments, but the rental price does not change, the number of apartments that are actually rented will be equal to the new, higher quantity demanded.
Analyzing Disequilibrium in a Rental Market
Consider a housing market that was initially in equilibrium. A sudden increase in population has caused demand to rise, but the price has not yet adjusted from its original level. Match each term to the phrase that best describes its status in this new market situation.
Evaluating a Policy Response to a Housing Demand Shock
Imagine a city's apartment rental market is in a stable state where the number of apartments people want to rent equals the number landlords are willing to offer at the current average price. Suddenly, a large new company opens, and many new people move to the city seeking apartments. If the average rental price does not change, what is the most likely immediate outcome for the number of apartments actually rented?
Determining Transaction Volume in a Disequilibrium Market
Analyzing a Housing Shortage
Calculating and Explaining Market Shortage