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Prioritizing Fairness over Pareto Efficiency in Rent Control
Rent Ceiling
A rent ceiling is the maximum legal price that a landlord is permitted to charge a tenant for rent.
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Economy
Economics
CORE Econ
Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
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Rent Ceiling
Analysis of a Rent Ceiling with Shifts in Demand and Long-Run Supply (Figure 8.25)
Summary of US Rent Control Research
Assessing a Rent Freeze Policy
A city government observes that rapidly rising housing costs are forcing many long-term residents and essential public service workers to move out. In response, the government institutes a policy that caps rental prices below the level the market would naturally set. This action is taken despite warnings that it may lead to a shortage of available rental units. Based on this scenario, what is the most likely primary justification for the government's decision?
The Rent Control Debate
A government's decision to implement rent control is considered economically irrational solely because it results in a housing shortage and moves the market away from a state of maximum total surplus.
Match each housing policy rationale with its most likely economic consequence.
The Rent Control Trade-off
A city government implements a rent control policy that sets a maximum legal rent below the market-clearing price. While acknowledging this may lead to a housing shortage, the stated goal is to protect vulnerable residents from displacement. Which of the following scenarios would represent the successful achievement of the government's primary stated goal, even at the expense of market efficiency?
Evaluating Housing Policy Alternatives
Evaluating the Success of a Rent Control Policy
The City Council's Dilemma
Learn After
Graphical Representation of the Rental Market with Rent Control
A city government, concerned about rising housing costs, imposes a maximum legal price for apartment rentals that is significantly below the current average market rate. Which of the following outcomes is the most likely consequence of this policy?
Evaluating a Rent Ceiling Proposal
Effectiveness of a Price Control
A government law that establishes a maximum legal rent of 1,500 per month will create a housing shortage.
A government imposes a legal maximum price on apartment rentals that is below the market-clearing level. Match each resulting market phenomenon with its correct description.
Evaluating the Economic Impacts of a Rent Ceiling
Explaining the Housing Shortage from a Rent Ceiling
A city government imposes a legally binding maximum price on apartment rentals, set below the price that would naturally occur in the market. Arrange the following events into the logical sequence that would typically unfold as a result of this action.
In a city, a government-imposed maximum legal rent of $1,200 per month is in effect. At this price, 10,000 people are seeking to rent apartments, but landlords are only willing to make 7,000 apartments available. This gap of 3,000 apartments represents a market ________.
The rental market in a university town has a market-clearing monthly rent of 800 per month. Shortly after, the university significantly expands its enrollment, attracting thousands of new students to the town. How does this university expansion alter the effects of the existing maximum rent policy?