(Figure: Rent Controls in the Market for Apartments in New York City) Use Figure: Rent Controls in the Market for Apartments in New York City. If a rent ceiling is set at $900:
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.

Question

(Figure: Rent Controls in the Market for Apartments in New York City) Use Figure: Rent Controls in the Market for Apartments in New York City. If a rent ceiling is set at $900: 
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.

Quizplus · Accepted Answer

At a rent ceiling of $900, landlords may not have sufficient incentive to maintain and improve the quality of their rental units, leading to inefficiently low-quality apartments.