If the government imposes a maximum rent for housing that is above the equilibrium price, then you predict that
A)the law will have no effect in the market for housing.
B)the law will generate a shortage of housing.
C)the law will create a surplus of housing.
D)the demand curve for housing shifts rightward.
E)the supply curve of housing shifts leftward.

Question

Quizplus · Accepted Answer

If the maximum rent is set above the equilibrium price, it is non-binding, meaning it does not affect the market as the equilibrium price is already lower than the imposed maximum.

If the Government Imposes a Maximum Rent for Housing That