Explain how the market for apartments allocates the scarce supply ...

[dalyningkenk]

Explain how the market for apartments allocates the scarce supply of apartments near the city center.
 
  What will be an ideal response?

Question 2

What does the supply curve tell us about the producer's minimum supply price?
 
  What will be an ideal response?

[14vl19]

Answer to Question 1

The free market for apartments resolves the question of who gets to live in the best apartments. The rental price of apartments provides incentives that effectively allocate economic resources. As the price of downtown apartments rises, only workers with the highest opportunity cost of time will be willing to rent them. All other workers will prefer to move further away and accept the consequences of a longer commute.

Answer to Question 2

For any quantity, the vertical distance between the supply curve and the x-axis shows the minimum price that suppliers must receive to produce that quantity of output. As a result, the price is the marginal cost of the last unit produced at this level of output.

[dalyningkenk]

TYSM

[frankwu0507]

Thanks for the timely response, appreciate it