Use the figure below to answer the following questions.

Figure 6.1.1
-Refer to Figure 6.1.1. If the demand for rental housing increases and the demand curve shifts rightward from D₀ to D₁, and there is a strictly enforced rent ceiling of $150 per room,
A)the number of rooms rented will increase to 2,000.
B)the number of rooms rented is 1,500.
C)there is a housing shortage of 500 rooms.
D)the number of rooms rented decreases to 1,000.
E)both B and C

Question

Use the figure below to answer the following questions.
  
Figure 6.1.1
-Refer to Figure 6.1.1. If the demand for rental housing increases and the demand curve shifts rightward from D₀ to D₁, and there is a strictly enforced rent ceiling of $150 per room,
A)the number of rooms rented will increase to 2,000. 
B)the number of rooms rented is 1,500. 
C)there is a housing shortage of 500 rooms. 
D)the number of rooms rented decreases to 1,000. 
E)both B and C

Quizplus · Accepted Answer

Since there is a strictly enforced rent ceiling of $150 per room, the sudden increase in demand for rental housing will create a shortage in the market. The equilibrium point will now be at point B where the demand curve intersects the supply curve. The quantity of rooms rented will decrease from 2,000 to 1,500. However, the demand for rental housing is still greater than the supply, resulting in a shortage of 500 rooms. Therefore, both answers B and C are correct.

Use the Figure Below to Answer the Following Questions