The competitive equilibrium rent in the city of Lowell is currently​ $1,000 per month. The government decides to enact rent control and to establish a price ceiling for apartments of​ $750 per month. Briefly explain whether rent control is likely to make each of the following people better or worse off. Someone currently renting an apartment in Lowell

Respuesta :

The question lacks the options for  "each of the following people better or worse off" but you can still think about this problems in the following terms, in neoclassical economics you would say that:

Anyone who's willing to supply or demand an apartment for prices between $750 and $1000 will be worse of because the will not find any

"Someone currently renting an apartment in Lowell" this is the only option given, but you need information about how much this person is paying (if it is a competitiv market all should be paying $1000) and if the price will change for those who are already renting and if the landlord can expell people from their apartaments

For example, if this person, pays $1000, and the price fall to $750, will be benefited if the owner can't ask them to leave if he is unwilling to rent below $1000