Question

In the short run, rent control causes the quantity supplied A. and quantity demanded to fall. B. to rise and quantity demanded to fall. C. and quantity demanded to rise. D. to fall and quantity demanded to rise.

Answer 1

D. to fall and quantity demanded to rise

Step-by-step explanation:

Rent control is also known as price regulation. It is the law placing the maximum price or the ceiling price which is set by the government based on which the landlords may charge the tenants.

It leads to a large shortage of the houses in the long run. But in the short run rent control enables the quantity of apartments to fall but the quantity demanded to be rise.

Hence the correct option is (D).