Class Lecture #37 - 11/30

The Economics of Price Controls: Price Ceilings
 - By setting a price ceiling, there are more apartments that people want than there actually are --> SHORTAGE
 - At Market Equilibrium:
      > P = $1,000  Q = 12,000
 - At "Controlled" Equilibrium:
      > P = $800   QD = 14,000  QS = 10,000
      > 4,000 shortage
      > Not market clearing

 - Major Outcomes of Price Ceilings:
     1. Reduced availability
     2. Lower quality
     3. Black markets
     4. Misallocations
     5. Other Neighborhoods
     6. Fairness
     7. Discrimination
     8.