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Here is the one-bedroom apartment market in a college town. It is in equilibrium at $1,000 with 15,000 units traded. For each of the following scenarios, determine the effect on equilibrium price and quantity of each of the following scenarios. Draw the new supply and demand situation. Explain the consequences for price and quantity. a. At the end of the Spring Semester, many college students leave town. b. The city government offers a tax break for developers to build apartment buildings. C. The University admits the biggest freshman class in its history.

Here is the one-bedroom apartment market in a college town. It is in equilibrium at $1,000 with 15,000 units traded. For each of the following scenarios, determine the effect on equilibrium price and quantity of each of the following scenarios. Draw the new supply and demand situation. Explain the consequences for price and quantity. a. At the end of the Spring Semester, many college students leave town. b. The city government offers a tax break for developers to build apartment buildings. C. The University admits the biggest freshman class in its history.

Brief Principles of Macroeconomics (MindTap Course List)
Brief Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN:9781337091985
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter4: The Market Forces Of Supply And Demand
Section: Chapter Questions
Problem 10PA
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15,000 Beginning Equilibrium Here is the one-bedroom apartment market in a college town. It is in equilibrium at $1,000 with 15,000 units traded. For each of the following scenarios, determine the effect on equilibrium price and quantity of each of the following scenarios. Draw the new supply and demand situation. Explain the consequences for price and quantity. a. At the end of the Spring Semester, many college students leave town. b. The city government offers a tax break for developers to build apartment buildings. c. The University admits the biggest freshman class in its history. d. The city imposes rent control in the neighborhoods around the university. e. The Federal Reserve Board reduces interest rates. f. The University closes down its largest dorm.
Transcribed Image Text:15,000 Beginning Equilibrium Here is the one-bedroom apartment market in a college town. It is in equilibrium at $1,000 with 15,000 units traded. For each of the following scenarios, determine the effect on equilibrium price and quantity of each of the following scenarios. Draw the new supply and demand situation. Explain the consequences for price and quantity. a. At the end of the Spring Semester, many college students leave town. b. The city government offers a tax break for developers to build apartment buildings. c. The University admits the biggest freshman class in its history. d. The city imposes rent control in the neighborhoods around the university. e. The Federal Reserve Board reduces interest rates. f. The University closes down its largest dorm.
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