Question

Consider a perfectly competitive market for rental housing. The monthly (inverse) demand and supply functions for...

Consider a perfectly competitive market for rental housing. The monthly (inverse) demand and supply functions for rental units are given by P = 70 – 0.7QD & P = 10 + 0.3QS, where P is monthly rent, and Q is the number of rental units. Note: Each numerical value MUST be rounded to ones. ex) 34.3 --> 34 or 1.5 --> 2

Part a) Using the given inverse functions above, compute the equilibrium price and quantity.

Q* =

P* =

Part b) Now suppose the government sets a maximum rent at $19. Compute the following under this price control.

Market quantity =

MB =

CS =

DWL =

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Consider a perfectly competitive market in the short-run with the following demand and supply curves, where...
Consider a perfectly competitive market in the short-run with the following demand and supply curves, where P is in dollars per unit and Q is units per year: Demand: P = 500 – 0.8Q Supply: P = 1.2Q Calculate the short-run competitive market equilibrium price and quantity. Graph demand, supply, and indicate the equilibrium price and quantity on the graph. Now suppose that the government imposes a price ceiling and sets the price at P = 180. Address each of...
The demand curve of a perfectly competitive product is described by the equation:     P =...
The demand curve of a perfectly competitive product is described by the equation:     P = $1000 – Q    where Q = thousands The supply curve is given by     P = $100 + 2Q     where Q = thousands Graph the demand and supply curves; use a grid size of 100. Calculate the equilibrium price and quantity (carefully state the units).  Find the consumer surplus CS, the producer surplus PS, and the deadweight loss DWL, carefully stating the units.
The demand and supply functions for rental accommodation in New York are as follows: Qd =...
The demand and supply functions for rental accommodation in New York are as follows: Qd = 120 - P Qs = 2P a. Solve for the competitive equilibrium rental rate (P) and quantity (Q) of rental units in New York. Illustrate this equilibrium in a graph. b. On your graph, show the regions that represent consumer surplus and producer surplus. Calculate the value of consumer surplus, producer surplus, and overall welfare. c. Suppose the City of New York enacts a...
The market for bauxite is perfectly competitive. Market inverse demand is given by PD(Q)=500-Q, where price...
The market for bauxite is perfectly competitive. Market inverse demand is given by PD(Q)=500-Q, where price is measured in dollars per ton and Q is measured in million of tons. Market inverse supply of bauxite is PS(Q)=100+Q, where price is measured in dollars per ton and Q is measured in millions of tons. -Calculate the equilibrium price and quantity in this market. Represent your solution using a graph. -Calculate producer and consumer surplus. Identify consumer and producer surplus on a...
Suppose a perfectly competitive market has the following inverse supply and demand curves: Supply: P= 5+2Q...
Suppose a perfectly competitive market has the following inverse supply and demand curves: Supply: P= 5+2Q Demand: P = 50-Q. 1) Solve for the perfectly competitive Pe and Qe, and calculate consumer+producer surplus at Pe, Qe.
2. The demand and supply functions for rental accommodation in Metroland are as follows: Qd =...
2. The demand and supply functions for rental accommodation in Metroland are as follows: Qd = 120 - P Qs = 2P a. Solve for the competitive equilibrium rental rate (P) and quantity (Q) of rental units in Metroland. Illustrate this equilibrium in a graph. b. On your graph, show the regions that represent consumer surplus and producer surplus. Calculate the value of consumer surplus, producer surplus, and overall welfare. c. Suppose the City of Metroland enacts a rent control...
The market for a product has inverse demand and supply functions given by p = 290...
The market for a product has inverse demand and supply functions given by p = 290 - 2Qd and p = 10 + 1.5Qs In what form are these functions in? (2pts) Find the market equilibrium quantity Q* and price P*. (5pts) Draw out a simple graph with these curves. Label the p-intercept for each and indicate the equilibrium points. (5pts) Find the consumer and producer surpluses, along with the total surplus.(10pts) (i) Would this market be considered efficient? (2pts)
The corn market is perfectly competitive, and the market supply and demand curves are given by...
The corn market is perfectly competitive, and the market supply and demand curves are given by the following equation: Qd =50,000,000 – 2,000,000 p Qs = 10,000,000 +5,500,000 p Where Qd and Qs are quantity demanded and quantity supplied measured in bushels, and P= price per bushel. 1) Determine consumer surplus at the equilibrium price and quantity.
2. The demand and supply functions for rental accommodation in Metroland are as follows: Qd =120-P...
2. The demand and supply functions for rental accommodation in Metroland are as follows: Qd =120-P Qs = 2P a. Solve for the competitive equilibrium rental rate (P) and quantity (Q) of rental units in Metroland. Illustrate this equilibrium in a graph. On your graph, show the regions that represent consumer surplus and producer surplus. Calculate the value of consumer surplus, producer surplus, and overall welfare. b. Suppose the City of Metroland enacts a rent control ordinance that imposes a...
Suppose the demand and supply curves for rental housing units have the typical shapes and that...
Suppose the demand and supply curves for rental housing units have the typical shapes and that the rental housing market is in equilibrium. Then, government establishes a rent ceiling below the equilibrium level. a. What happens to the quantity of housing available b. What happens to the quality of housing and why? c. Who benefits from rent control? d. Who loses from rent control? e. How do landlords of rent-controlled apartments try to get tenants to leave?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT