Rent Controls Essay – How does imposing rent controls affect the number of housing units available to low-income families Essay

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This is a two part question:

1. The famous Swedish economist Assar Lindbeck remarked in his book on rent controls, “Rent control appears to be the most efficient technique presently known to destroy a city – except for bombing”; Rent controls place price ceilings on rents at levels below equilibrium rental rates for the stated purpose of making housing more affordable for low-income families. Using supply and demand analysis, answer the following questions:

•How does imposing rent controls affect the number of housing units available to low-income families?

•Under rent controls, can all low-income families get rent-controlled housing?

•Who gains from rent controls? Who loses?

•Why would Professor Lindbeck think rent controls are destructive?

•Is there an alternative policy to make plenty of housing available to low-income families that would not be subject to the problems of rent controls? Explain in detail.

Part two of Question:

CORPORATE ANNUAL REPORTS—IDENTIFY FIXED AND VARIABLE COSTS Use the Google search engine at www.google.com to locate the home page of a company of your choice. Find and review the company’s income statement in its annual report and classify the nonrevenue items as either fixed or variable costs. Are all costs clearly identifiable as either fixed or variable? What item would be considered accounting profit? Would economic profit be higher or lower than this accounting profit.

(Use either Google or another business source, such as the Wall Street Journal. Be sure to cite your source(s) using APA stlye.

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