Question

If there is a shortage in a rental market, what is expected? A. Rental prices to stay the same. B. Rental prices to be increasing until shortage is eliminated. C. Rental prices to be decreasing until shortage is eliminated. D. Rental prices to either be increasing or decreasing.

Answer 1

Rental prices to be increasing until shortage is eliminated

Step-by-step explanation:

If there is a shortage in the rental market, it means that quantity supply has reduced. This would lead to an excess of demand over supply which is known as a shortage. When there's a shortage, prices rise until the shortage ceases.