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Excess demand in an apartment market with a rent ceiling

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Recent increases in rents has lead the citizens of Elmville to vote in a rent ceiling of $1200. Assuming all rental units in Elmville are identical and the supply and demand for rental units are given by

Qs = -1000 + 20P

Qd = 50000 - 10P

What will be the excess demand for apartments once the price ceiling is implemented?

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Solution Summary

This solution shows how to calculate the excess demand for apartments in a market where there is a rent ceiling.