Question

suppose the government of greenville, after receiving numerous complaints from residents about rising housing costs, imposed a rent control regulation which limits the rent to $2000 for a 2 - bedroom apartment. this limit is below the market rate of $2500 for such apartments. 1. this regulation is a type of price ceiling 2. _and is likely to create a shortage 3. _which over a longer period of time is likely to select 4. select shrink remain unchanged grow and for the apartments are in the long run.

Explanation:

1. A price - ceiling is a legal maximum price. Since the rent control sets a maximum rent below the market rate, it's a price ceiling.
2. When a price ceiling is set below the equilibrium price, quantity demanded exceeds quantity supplied, creating a shortage.
3. In the long - run, with a price ceiling, suppliers have less incentive to provide the good or service. As a result, the supply of apartments is likely to shrink.

Answer:

1. price ceiling
2. shortage
3. shrink