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Suppose the government regulates the prices of beef and chicken and sets them below their market-clearing levels.
What will happen to the price of pork? Explain briefly.
晕,我以为PRICE会DECREASE...但是...
还有
(b) (2 marks)
Suppose the agency bows to the wishes of the board and sets a rental of $900 per month on all apartments to allow landlords a “fair” rate of return. If 50 percent of any long-run increases in apartment offerings come from new construction, how many apartments are constructed?
QS = 70 + 7*9 (new price)
= 133
QS = 70 + 7*6 (market-clearing price)
= 112
New construction = (133 ? 112)*0.5
= 10.5 tens of thousands of apartment
Therefore 10.5 tens of thousands of apartments are constructed.
对吗?
What will happen to the price of pork? Explain briefly.
晕,我以为PRICE会DECREASE...但是...
还有
(b) (2 marks)
Suppose the agency bows to the wishes of the board and sets a rental of $900 per month on all apartments to allow landlords a “fair” rate of return. If 50 percent of any long-run increases in apartment offerings come from new construction, how many apartments are constructed?
QS = 70 + 7*9 (new price)
= 133
QS = 70 + 7*6 (market-clearing price)
= 112
New construction = (133 ? 112)*0.5
= 10.5 tens of thousands of apartment
Therefore 10.5 tens of thousands of apartments are constructed.
对吗?