{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

# csps1a - \$800_3,000 What is the quantity of apartments that...

This preview shows page 1. Sign up to view the full content.

13 400 1000 1200 Additional Problem #1 Answers : Consumer and Producer Surplus The graph below shows the demand and supply of rental housing for Microtown. \$/month S 800 600 200 D Quantity 0 1 2 3 4 5 6 (thousands/month) a) What is the equilibrium rent/month? __\$600 ________; the total rent/month at the equilibrium quantity of rental units? __\$1,800,000 ______; the consumer surplus? ____\$900,000 ____; the producer surplus? ___\$900,000 ____. b) What is the quantity of apartments that will be rented if a price ceiling is set at
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: \$800? ___3,000 __. What is the quantity of apartments that will be rented if a price ceiling is set at \$400? _2,000 __. What is the consumer surplus given this price ceiling? ____\$400,000 ___; the producer surplus? ___\$400,000 __; the dead weight loss? ____\$200,000 ____; the search cost for rental? __\$800,000 ___. Note : This problem may also be constructed with algebraic expressions for demand and supply as follows: Demand : P = 1200 – 200Q Supply : P = 200Q...
View Full Document

{[ snackBarMessage ]}