Which of the following will most likely result from rent controls that reduce monthly rental rates below market equilibrium?
A) Shortages and black markets for rental housing will develop.
B) The quality of rental housing will improve.
C) The future supply of rental housing will increase rapidly.
D) Discrimination against minorities and persons with unconventional lifestyles will decline in the rental housing market.

Question

Quizplus · Accepted Answer

Rent controls that reduce monthly rental rates below market equilibrium will create a shortage of rental housing because the quantity supplied will be less than the quantity demanded at the lower price. This shortage will cause a black market for rental housing to develop, where landlords will charge higher rents under the table.

Which of the Following Will Most Likely Result from Rent