2. Economic rent and the market for landConsider the market for land in upstate New York, a mostly rural and less populous area, as compared to the market for land in the Upper West Sideof New York City, a well-to-do neighborhood alongside Central Park.4Because the supply of land in upstate New York island.buyers in upstate New York payfor use of theThe rental price of land is much higher in the Upper West Side of New York City than in less densely populated areas like upstate New York. Onepossible explanation for this rent difference is that highly productive land is in highSome entrepreneurs decide to build parking lots in the Upper West Side of New York City. The supply curve for land to be used for parking lots is

Explanation:Perfectly inelastic: The supply of land in a specific location is likely fixed. There's…

Answered: 2. Economic rent and the market for…

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter4: Labor And Financial Markets

Section: Chapter Questions

Problem 31P: Table 4.6 shows the amount of savings and barrowing in a market for loans lo purchase homes,...

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use diagramsa. What is the effect on the equilibrium price and quantity traded in market of theintroduction of a new technology that reduces costs of production for all firms?b. What is the effect on the equilibrium price and quantity traded in a market of a changein tastes that reduces the demand for the product?c. What is the effect on the equilibrium price and quantity traded in a market of theimposition of a tax per unit sold on suppliers?d. What is the effect on the equilibrium price and quantity traded in a market of thepayment of a subsidy per unit sold paid to suppliers?
2. Mark and Jonathan are going to look for an apartment together. Mark has a reservation price of $850 and Jonathan has a reservation price of $750 if they are going to share a room. Assume the rent for a two- bedroom apartment is $1850 and a 1-bedroom apartment is $1400. a. Will Jonathan and Mark be able to rent an apartment together and will it be a 1-bedroom or 2-bedroom? b. Will they be able to split the rent evenly, or will Mark have to pay more? c. Which option is the most fair - splitting the rent evenly or splitting the surplus evenly?
Table 24-5The table below pertains to Wrexington, an economy in which the typical consumer’s basket consists of 20 pounds of meat and 10 toys. Year Price ofMeat Price of aToy 2004 $3 per pound $2 2005 $1 per pound $7 2006 $4 per pound $5 Refer to Table 24-5. The cost of the basket Group of answer choices increased from 2004 to 2005 and increased from 2005 to 2006. increased from 2004 to 2005 and decreased from 2005 to 2006. decreased from 2004 to 2005 and increased from 2005 to 2006. decreased from 2004 to 2005 and decreased from 2005 to 2006.
18. How prices allocate resources Suppose that there are three plots of mountain resort land available for sale in Park City and six potential buyers, each interested in purchasing one plot. Assume that all of the plots are basically indistinguishable and that the minimum selling price of each is $595,000. The following table lists each potential buyer's willingness and ability to purchase a plot of land. Person Andrew Beth Lorenzo Neha Sam Teresa Which of these people will purchase one of the three mountain resort plots? Check all that apply. Andrew Willingness and Ability to Purchase (Dollars) 540,000 530,000 750,000 660,000 620,000 570,000 Beth Lorenzo
5 enter your answer as whole numbers A. What is the market equilibrium rental price per month and the market equilibrium number of apartments demand and supplied? market equivalent rental price is: ______ per month B. If the local government can enforce a rental control law that sets the maximum monthly rent at $2250 will there be a surplus or a shortage? ______ Of how may units ______ apartments per month How many units will actually be rented each month? ________ apartments C. Suppose that a new government is elected that wants to keep out the poor. It declares that the minimum rent that can be charged is $3,250 per month. If the government can enforce that price floor will there be a surplus or a shortage? _______ Of how many units? _______ apartments per month how many units will actually be rented each month? _______ apartments
Table 4.6 shows the amount of savings and barrowing in a market for loans lo purchase homes, measured in millions of dollars, at various interest rates. What is the equilibrium interest rate and quantity in the capital financial market? How can you tell? Now, imagine that because of a shift in the perceptions of foreign investors, the supply curve shifts so that there will be 10 million less supplied at every interest rate. Calculate the new equilibrium interest rate and quantity, and explain why the direction of the interest tale shift makes intuitive sense.
2. Which of the following is an economic policy that promotes the efficient quantity of apartments? a rent floor above the equilibrium rent a rent ceiling below the equilibrium rent a sales tax imposed on renting an apartment none of the above
16. How prices allocate resources Suppose that there are three plots of mountain resort land available for sale in Stowe and six potential buyers, each interested in purchasing one plot. Assume that all of the plots are basically indistinguishable and that the minimum selling price of each is $445,000. The following table lists each potential buyer's willingness and ability to purchase a plot of land. Person Ana Kevin Maria Rajiv Simone Yakov Ana Which of these people will purchase one of the three mountain resort plots? Check all that apply. Kevin Maria Rajiv Willingness and Ability to Purchase (Dollars) 380,000 Simone Yakov 600,000 510,000 470,000 420,000 390,000 Now, assume that the three mountain plots have been sold to the people that you indicated in the previous section. Suppose that a few weeks after the last of those mountain plots is sold, another basically identical mountain plot goes on the market for sale at a minimum price of $432,500. This fourth plot be sold, because…
1. The rental market in a town is considering a rent control law. If implemented, this law would lower all rents in the town to $400 per month. Suppose all rentable properties in this town are alike, the current market clearing rent is $500 per month, and that at this market clearing price there are 500 rental units. Further, suppose that it is predicted that with rent control, the number of units available for rent will fall to 400 and there will be 200 units that are not occupied. Assume that the market demand and supply of rental units are linear. Calculate the dollar value of the impact rental law policy on the landlords, tenants and society as a whole 2$ 500 400 D. Rental units 500
Refer to the figure, Price (dollars) 600 550 500 450 400 350 300 250 200 150 100 50 0 Market for Game Consoles S 10 20 30 40 50 60 70 80 90 100110 Quantity Toola DL 0 O Use the graph to show the area representing the deadweight loss, and then determine the deadweight loss created as a result of setting the price at $150. Instructions: Use the tool provided "DL to illustrate this area on the graph. Deadweight loss: $
K Figure 4.2.2 The Market for Robotic Rubber Ducks Price $40 $ 50 $ 60 $70 $ 80 $ 90 $100 Quantity Demanded OA 70,450 OB. 70: 350 OC. 50:450 OD. 50, 350 OE 60,400 500 450 400 350 300 250 200 Quantity Supplied 300 350 400 450 500 550 600 Look at Table 4.2.2. Consumers learn that rubber ducks wear out batteries quickly. As a result, demand decreases by 100 rubber ducks at each pnce. The new equum price nubber ducks the new equilibrium quantity is Tine Remaining 00:30-40 Nest
1. Create a price ceiling that makes it against the law for landlords to charge more than $1000 per month. 2. Give low-income renters a voucher of $300 that can be used to help pay for housing costs each month. Organize the items according to which idea they are associated with. Associated with the price ceiling Associated with the voucher Answer Bank pushes down housing costs for people who are well-off and рor alike increase the amount of available housing relies upon funding from the government reduce landlords' incentive to spend money on maintenance can be targeted to help specific subsets of the population results in firms having a reduced incentive to build new housing

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