Assume that there is rent control in Chicago. Which of the following is true?
A) All consumers in the rental market will benefit because the rent will be lower.
B) The total surplus will fall because there will be a shortage of apartments.
C) The total surplus will rise because consumer surplus will increase.
D) Consumer surplus will increase and as a result all consumers in the rental market will benefit.
Answer: B) The total surplus will fall because there will be a shortage of apartments.
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Changes in which of the following factors do NOT shift the demand curve?
A) the price of the good B) buyers' incomes C) the price of a substitute good D) the number of buyers E) the price expected in the future
The MP curve indicates the relationship between ________ and the ________
A) taxes; price level B) the real interest rate; inflation rate C) monetary policy; IS curve D) all of the above E) none of the above