[ECON 2300] - Final Exam Guide - Comprehensive Notes for the exam (103 pages long!)

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We"ve now described four possible ways of allocating apartments to people: the competitive market, a discriminating monopolist, an ordinary monopolist, rent control. These are four different economic institutions for allocating apartments. Each method will result in different people getting apartments or in different prices being charged for apartments. We might well ask which economic institution is best. One thing we can do is to look at the economic positions of the people involved. It is pretty obvious that the owners of the apartments end up with the most money if they can act as discriminating monopolists: this would generate the most revenues for the apartment owner(s). Similarly the rent-control solution is probably the worst situation for the apartment owners. They are probably worse off on average in the case of a discriminating monopolist most of them would be paying a higher price than they would under the other ways of allocating apartments.

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