Use the following to answer questions: Figure: Rent Controls -(Figure: Rent Controls) Look at the figure Rent Controls. If rent controls are set at Rent₁: A) rental apartments may be of inefficiently low quality. B) there will be an efficient allocation of rentals. C) some landlords may break the law by renting below the mandated price. D) new apartments will be constructed.

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Rent controls set below the equilibrium price can lead to a shortage of rental apartments, causing landlords to reduce maintenance and quality to cut costs, resulting in inefficiently low-quality apartments.

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