What are the effects of a rent ceiling that is set below the equilibrium rent?
What will be an ideal response?
If the rent ceiling is set below the equilibrium rent, the quantity of housing units demanded by renters exceeds the quantity supplied by landlords. Since landlords are not forced to supply more units than the supply curve would indicate for the rent ceiling price, the quantity of housing units actually rented equals the quantity supplied, rather than the quantity demanded. This causes a shortage in the rental housing market.
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According to Joseph Schumpeter, many Midwestern railroads:
a. were built too late and thus faced heavy competition from trucks. b. were built ahead of demand. c. were unnecessary because they followed routes already adequately served by other means of transportation. d. would have been built more quickly in the absence of government aid.
There is no cost of using your own savings in your business
a. True b. False Indicate whether the statement is true or false