5. What is the efficient rental rate in this market (S/apt.)?6. What is the efficient rental quantity in this market (# of apts)?7. The government intervened in this market setting the price at $3000. What do economistscall this intervention?8. Gains and losses of this government interventiona. How many tenants received an apartment at the lower rent as a result of the intervention?b. How many fewer apartments were available as a result of the intervention?c. Identify the new consumer surplus area by lettersd. What is the dollar value of consumer surplus after the intervention?Show computation here:e. Identify the new producer surplus area by lettersf. What is the dollar value of producer surplus after the intervention?Show computation here:g. Identify the deadweight loss area by letters after the interventionh. What is the dollar value of the deadweight loss after the intervention?Show computation here:i. Identify the rectangle, by letters, of the incurred search cost to society?j. What is the dollar value of the incurred search cost to society?Show computation here:9. Compute the percentage change in consumer surplus before and after government interventionShow computation here: P of apartments10,000 At8,000 F5,000 B3,000 P1,000 cHi20,00040,00080,000SDSupply Curve = MarginalCostDemand Curve =MarginalBenefitQ of apartments

The forces of demand and supply as represented by demand and supply curves respectively can be used…

5. What is the efficient rental rate in this market (S/apt.)? 6. What is the efficient rental quantity in this market (# of apts)? 7. The goverment intervened in this market setting the price at $3000. What do economists call this intervention?

5. What is the efficient rental rate in this market (S/apt.)? 6. What is the efficient rental quantity in this market (# of apts)? 7. The goverment intervened in this market setting the price at $3000. What do economists call this intervention?

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter1: Ten Principles Of Economics

Section: Chapter Questions

Problem 6PA

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Question

5. What is the efficient rental rate in this market (S/apt.)?
6. What is the efficient rental quantity in this market (# of apts)?
7. The government intervened in this market setting the price at $3000. What do economists
call this intervention?
8. Gains and losses of this government intervention
a. How many tenants received an apartment at the lower rent as a result of the intervention?
b. How many fewer apartments were available as a result of the intervention?
c. Identify the new consumer surplus area by letters
d. What is the dollar value of consumer surplus after the intervention?
Show computation here:
e. Identify the new producer surplus area by letters
f. What is the dollar value of producer surplus after the intervention?
Show computation here:
g. Identify the deadweight loss area by letters after the intervention
h. What is the dollar value of the deadweight loss after the intervention?
Show computation here:
i. Identify the rectangle, by letters, of the incurred search cost to society?
j. What is the dollar value of the incurred search cost to society?
Show computation here:
9. Compute the percentage change in consumer surplus before and after government intervention
Show computation here:

P of apartments
10,000 At
8,000 F
5,000 B
3,000 P
1,000 c
Hi
20,000
40,000
80,000
S
D
Supply Curve = Marginal
Cost
Demand Curve =Marginal
Benefit
Q of apartments

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