Question

When cities prevent landlords from charging market rents, which of the following are common long-run outcomes? Check all that apply. Landlords earn lower profits from renting housing units, but the rent charged has no effect on either the quantity or quality of rental units. Black markets develop. The quality of rental housing units falls. The quantity of available rental housing units falls.

Answer 1

Answer: Option (b) is correct

Step-by-step explanation:

When cities prevent or stop the landlords to collect the market rents then this will lead to black marketing. After this prevention, landlords try to fool the system or the public by charging higher rent for the apartments and in fact, this is done with no legal paper work or documentation and manipulation of rules and regulations. Hence, this will results in black market.

Answer 2

The second option is better: Black markets develop.

If the landlords has to rent their property below the expected return it will stop renting it and sale the property. Therefore, people wanting to rent property will have to agree on payments below the table. If impossible to sale or to increase rent they will stop maintenance and repair expense to increase profitability in expense of the quality of life of the peiople living there.

Resuming, they won't oblige to the norm either by withdraw from the market (stop renting) or reinvestment (maintenance)