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Discuss what will be the long run effect on the real estate

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Reference no: EM133598607

Question: Assume that all students are in the market for rental housing. By means of the DiPasquale- Wheaton model (4Q model): a) illustrate and discuss what will be the long run effect on the real estate system if the student loans and scholarships are reduced substantially and permanently. State your assumptions. b) comparing the new (long-run) equilibrium situation with the initial equilibrium: has the rent-price ratio changed? Explain. c) the long-run equilibrium in the DiPasquale & Wheaton model is characterized by a fixed stock of space, yet the southeast quadrant shows that new construction is taking place. Why is this?

Reference no: EM133598607

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