Rent Controls Set a Price Ceiling Below the Equilibrium Price

question 10

Multiple Choice

Rent controls set a price ceiling below the equilibrium price and therefore:

• A) quantity supplied exceeds the quantity demanded.
• B) quantity demanded exceeds the quantity supplied.
• C) a surplus of rental units will result.
• D) poor people will obviously and clearly be helped.

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Definitions:

FICA

The Federal Insurance Contributions Act tax is a United States federal payroll tax imposed on both employees and employers to fund Social Security and Medicare.

SUTA

State Unemployment Tax Act; a tax paid by employers at a state level to fund unemployment benefits for workers who lose their jobs.

FUTA

The Federal Unemployment Tax Act, which imposes a payroll tax on businesses to fund state workforce agencies.

Wages Expense

The total cost incurred by a company for the payment of wages to employees during a specific period.