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Yes.
Its a price ceiling. In other words, the true price that would put the market in equilibrium is much higher than the artificially applied ceiling. Since quantity demanded on a commodity increases as price decreases, people will want more if the price is artificially low. This leads to people wanting more housing than what actually exists.
There is no incentive to build more housing because you cant get the market price for your building.
If the market were allowed to adjust naturally, rent would go up and people would move to a town with lower rent.
What else can I help you with?
What is the shape of demand curve in monopoly?
The demand curve is downwards sloping with price on the vertical axis and quantity demanded on the horizontal axis. This is because as products get more expensive the quantity demanded decreases, other things being equal. Put another way, there is a negative correlation between price and quantity demanded.
What is low of supply in economics?
The law of supply in economics states that, all else being equal, an increase in the price of a good or service leads to an increase in the quantity supplied. Producers are generally more willing to supply more of a product when they can sell it at higher prices, as this can lead to greater revenue and profit. Conversely, if the price decreases, the quantity supplied typically decreases as well. This relationship illustrates the direct correlation between price and quantity supplied in a competitive market.
Distinguish between change in demand and change in quantity demanded with the aid of a diagram?
A change(shift) in demand refers to a change in the amount of a product or service demamded in regards to changes in expectations,income,demographics,substitutes and expectations and will cause a "shift" in the demand curve. A change in quantity demanded refers to a change of the inputs(resources required to produce that good or service) required to produce the goods or services being demanded. If the price of producing the good or service changes then the quantity demamded will "change" causing a movement along the demand curve.
What would happen to 9 the demand curve for crayons if there was an increase in the price of markers?
The quantity demanded would increase at all prices due to it being a cheaper substitute for markers
If a fall in the price of good?
If a fall in the price of a good occurs, it typically leads to an increase in the quantity demanded by consumers, as the product becomes more affordable. This phenomenon is described by the law of demand, which states that, all else being equal, lower prices result in higher demand. Conversely, producers may reduce the quantity supplied due to lower profit margins. Overall, market equilibrium may shift as consumer behavior adjusts to the new price level.
How is demand elasticity measured?
Whenever the price drops, the quantity being demanded will rise and the quantity supplied will fall. The directions of these changes are all that matter. The price elasticity of demand is often measured as the percentage change in quantity demanded divided by the percentage change in price. On the other hand, the price elasticity of supply is measured as the percentage change in quantity supplied which will be divided by the percentage change in price. Just like the fuel and other prime commodities, we are sensitive whenever there is a change in price. If we are sensitive to prices, even a small amount of change in the prices will cause a large change in our willingness to buy.
When the selling price of a good goes up what is relationship to the quantity supplied?
In most cases, the quantity goes down since the demand is higher that what is being supplied, leading to high competition. But yes
What is the principle of demand?
The law of demand states that all other things being equal, as the price of a commodity falls quantity demanded increases and vice versa.
What is the shape of demand curve in monopoly?
The demand curve is downwards sloping with price on the vertical axis and quantity demanded on the horizontal axis. This is because as products get more expensive the quantity demanded decreases, other things being equal. Put another way, there is a negative correlation between price and quantity demanded.
What is low of supply in economics?
The law of supply in economics states that, all else being equal, an increase in the price of a good or service leads to an increase in the quantity supplied. Producers are generally more willing to supply more of a product when they can sell it at higher prices, as this can lead to greater revenue and profit. Conversely, if the price decreases, the quantity supplied typically decreases as well. This relationship illustrates the direct correlation between price and quantity supplied in a competitive market.
Distinguish between change in demand and change in quantity demanded with the aid of a diagram?
A change(shift) in demand refers to a change in the amount of a product or service demamded in regards to changes in expectations,income,demographics,substitutes and expectations and will cause a "shift" in the demand curve. A change in quantity demanded refers to a change of the inputs(resources required to produce that good or service) required to produce the goods or services being demanded. If the price of producing the good or service changes then the quantity demamded will "change" causing a movement along the demand curve.
What would happen to 9 the demand curve for crayons if there was an increase in the price of markers?
The quantity demanded would increase at all prices due to it being a cheaper substitute for markers
If a fall in the price of good?
If a fall in the price of a good occurs, it typically leads to an increase in the quantity demanded by consumers, as the product becomes more affordable. This phenomenon is described by the law of demand, which states that, all else being equal, lower prices result in higher demand. Conversely, producers may reduce the quantity supplied due to lower profit margins. Overall, market equilibrium may shift as consumer behavior adjusts to the new price level.
When the price of a commodity increases the quantity demanded from that commodity is expected to decline?
When the price of a commodity increases, consumers typically react by purchasing less of that commodity, leading to a decline in quantity demanded. This behavior is driven by the law of demand, which states that, all else being equal, higher prices result in lower quantities demanded because consumers may seek substitutes or reduce their overall consumption. Additionally, higher prices can limit affordability, further decreasing demand.
What does demand schedule show?
A demand schedule shows a listing of the various quantities demanded of a particular product at all prices that might prevail in a market.
How does elasticity vary along a straight-line demand curve?
Elasticity varies along a straight-line demand curve by being different at different points. At the top of the curve, elasticity is more elastic, meaning small changes in price lead to larger changes in quantity demanded. At the bottom of the curve, elasticity is less elastic, meaning changes in price have less impact on quantity demanded.
What does the Law of Supply say?
The Law of Supply states that, all else being equal, there is a direct relationship between the price of a good or service and the quantity supplied by producers. As the price increases, producers are willing to supply more of the good, and conversely, as the price decreases, the quantity supplied tends to decrease. This principle reflects the incentive for suppliers to maximize profits in response to market conditions.
