Which of the Explanations Below Best Describes Why a Government

question 123

Multiple Choice

Which of the explanations below best describes why a government might choose to impose binding rent controls?

• A)To prevent landlords from making excess profits and to protect low-income tenants from increases in the cost of housing.
• B)To prevent landlords from making excess profits and to reduce the long-term quantity of rental housing.
• C)To increase the demand for rental housing and to discourage private ownership of low-cost rental housing developments.
• D)To stabilize volatile rents,and thus to make the investment climate less uncertain for prospective investors in this sector.
• E)To stimulate employment in the construction industry through the increased demand for new houses.

---

Definitions:

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been deducted from total revenue.

Profit Margin Ratio

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating the profitability of sales.

Net Income

The total earnings of a company after deducting all expenses, taxes, and losses, indicating the company's profitability.

Net Sales

The revenue from sales after deducting returns, allowances for damaged or missing goods, and discounts.