Assume That The City Council In Prescott

Assume that the City Council in Prescott, AZ is considering implementing price ceilings on rental units based on the number of bedrooms in the unit. The demand function for rental units (on a single bedroom equivalent basis) is given by QD = 120 – 4P and the supply function is given by QS = 2P, where P is price and Q is quantity. The Council is giving consideration to imposing a ceiling price on rental units of Pmax = 16. Question: Could you please explain what they mean by Pmax = 16Also could you please explain what schedules should be use. . . or let me know if I am on the right track with the following schedule: Price Demand Supply 120 236 240 130 246 260 140 256 280 150 266 300 160 276 320

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