The Figure below illustrates the market for rental apartments in Clarksville. Use it to answer questions 1 through 5.
Chapter 6 Homework (eleven questions)
Two point questions:
The Figure below illustrates the market for rental apartments in Clarksville. Use it to answer questions 1 through 5.
- What are the equilibrium rent and equilibrium quantity of rental apartments?
- If a rent ceiling is set at $500 a month, what is the quantity of apartments rented?
- If a rent ceiling is set at $500 a month, what is the shortage of apartments?
- If a rent ceiling is set at $500 a month, what is the maximum price that someone is willing to pay for the last apartment available?
- If a rent ceiling is set at $700 a month, what is the quantity of apartments rented?
- If a rent ceiling is set at $700 a month, what is the shortage of apartments?
The table below gives the demand and supply schedules of teenage labor. Use it to answer questions 7 through 10.
| Wage rate (dollars per hour) |
Quantity demanded | Quantity supplied |
| (hours per month) | ||
| 6 | 25,000 | 5,000 |
| 7 | 20,000 | 10,000 |
| 8 | 15,000 | 15,000 |
| 9 | 10,000 | 20,000 |
| 10 | 5,000 | 25,000 |
- What are the equilibrium wage rate and number of hours worked?
- What is the quantity of unemployment at the equilibrium wage?
- If a minimum wage for teenagers is set at $9 an hour, how many hours do teenagers work and how many hours are unemployed?
- If the demand for teenage labor increases by 10,000 hours a month, what is the wage rate paid to teenagers and how many hours of teenage labor are unemployed?
- As the price elasticity of demand decreases (becomes more inelastic), the size of the price increase resulting from a tax (goes up or goes down?) and the share of the tax borne by consumers (goes up or goes down?).
