Exploring Macroeconomics
8th Edition
ISBN: 9781544363332
Author: Robert L. Sexton
Publisher: Sage Publications
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Chapter 5, Problem 4P
To determine
Effect of setting rental price ceilings above and below the equilibrium price for apartments.
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Chapter 5 Solutions
Exploring Macroeconomics
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- Why would demand for steel may decline when demand for aluminum rises? What kind of relationship exists between the two?arrow_forwardThe rent for 2-bedroom apartments in Las Vegas rose from an average of $954 in June 2017 to $1,038 in June 2018. Demand for 2-bedroom apartments in Las Vegas was rising during this period as well. This is hard to explain because the law of demand says that higher prices should lead to lower demand. Do you agree or disagree? Explain your answer.arrow_forwardWith the aid of an appropriate diagram, explain how the equilibrium price and quantity traded of a normal good will change with an increase in the daily minimum wage.arrow_forward
- The graph below shows a price ceiling that happens to lie exactly at the equilibrium price. Drag the price ceiling line (Pceil) away from the equilibrium price, either up or down, to make it a nonbinding price ceiling. To refer to the graphing tutorial for this question type, please click here. Price D 9 Pceil Quantity 22 OF 50 QUESTIONS COMPLETED SUBMIT ANSWERarrow_forwardExplain the factors that determine the fixation of price in the agricultural marketarrow_forwardAs you can see from the article in the prior problem, "Rents Hit All-Time Highs amid Job Growth and Low Vacancy Rates," some people move out as a result of rent increases, while others are ready to pay an even higher rent. Rent control adds yet another aspect by setting a ceiling on what the rental price can ultimately rise to. The supply and demand model can be used to illustrate the mechanism that leads to all these different market outcomes. Consider the market for rental properties in Los Angeles and Orange counties in Southern California. Suppose that while average earnings increased by about 10% in Los Angeles and Orange counties, the average rent has increased by 20%. (Assume for a moment that there are no rent control regulations.) Adjust the following graph to illustrate the rent increase by either using the black point (cross symbol) or by shifting the supply and demand curves. The Market for Rental Properties in Los Angeles and Orange Counties 4000 3600 Supply Demand 3200…arrow_forward
- Suppose the demand for a product is given by Q=51-7P, supply is given by Q=31+4P. Calculate the equilibrium price for this market. Please round your answer to one decimal.arrow_forwardFind the equilibrium price and quantity for the following markets : Qs = - 45 + 8P Qd = 125 – 2Parrow_forwardWHEN DO YOU SAY THAT THERE IS EXCESS SUPPLY FOR A COMMODITY IN THE MARKET?arrow_forward
- why is it possible to have a 150% increase in price but not a 150% decrease in price?arrow_forwardThe demand and supply curves for beach volleyballs are given by: D = 80-4P S = -2+2P The current price is 19. How much is the excess supply or demand? Write a positive number if you find an excess supply, and write a negative number if you find an excess demand. (round your answer to one decimal place)arrow_forwardWhat will occur in the market when there is an excess quantity demanded of a product at the current price? The price will tend to rise. The price will tend to fall. Producers will reduce output and sales will fall. The price must be above the equilibrium price.arrow_forward
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