Question

In at least four sentences, explain if rent control is a price floor or price ceiling. Then explain one advantage and one disadvantage of rent control.

Answer 1

Answer:

Rent control is the rent ceiling as it is the limit within which a house owner may charge a tenant for a certain house.

One advantage is that it provides a space for diversity instead of being occupied solely by the rich. On the other hand, it also reduces the maintenance effort of the landowner for it cannot recoup the maintenance fees with a rise in rent, as he is under the obligation of this rent control.

Explanation:

Rent control is a mechanism that controls the limits on which housing is done or given out. This allows a fixed limit that controls the prices of renting a place, to ensure there are no shortage of housing for the common people.

This phenomena of rent control is price ceiling as it sets a limit to which a landowner may charge for the place. It cannot be price floor for any house-owner can make the price as low as he wants it to be but rent control rather controls or sets the limit within which any housing is allowed or given out, so as not to unnecessarily or excessively put a burden on someone.

One advantage of this rent control is that it limits the landowners to charge excessively for a certain house. It provides a safety net for those looking for a house to rent and provides a space for all types of people to reside together instead of being solely occupied by only the rich. It became beneficial for those who could only afford a certain amount of money for housing.

On the other hand, this control of rent or rent ceiling is that it lowers or decreases the maintenance of the housing complex as house-owners cannot increase the rent to provide such maintenance efforts.