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Use the Following Information to Answer the Next 2 Questions

Question 10

Multiple Choice

Use the following information to answer the next 2 questions.
Suppose demand for apartments in a metropolitan area is: #Apt.units=60,000 +0.30) # households) -80) *$Rent/unit/mo.)
-If developers increase the number of apartment units from 88,000 to 100,000, over a period of several years, to what level will real rent fall in the market below the original $400/mo level if the population remains stable at 200,000 households?


A) $350
B) $300
C) $250
D) $200
E) Cannot be determined from the information given.

Correct Answer:

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