Suppose that the equilibrium rent for a two-bedroom apartment in downtown Chicago is $900 per month.The city council decides to place a maximum price on apartment rents and will not allow landlords to charge more than $700 per month.Draw this situation using a graph.Make sure that you show the original equilibrium and the effect of the maximum price on the market.What will happen in this market? What will happen to total surplus?

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The Answer of Suppose that the equilibrium rent for a two-bedroom apartment in downtown Chicago is $900 per month.The city council decides to place a maximum price on apartment rents and will not allow landlords to charge more than $700 per month.Draw this situation using a graph.Make sure that you show the original equilibrium and the effect of the maximum price on the market.What will happen in this market? What will happen to total surplus?

Suppose That the Equilibrium Rent for a Two-Bedroom Apartment in Downtown