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The Price Effects of Vouchers and Recipient Welfare Using Figure 15–4 as a starting point ( v is the voucher point and j is the publichousing point), suppose the $300 program increases the price of housing, from $1 to $1.50 per unit of housing. a. Draw the voucher budget line with a housing price of $1.50. b. For a household that chooses 300 units of housing service, its spending on all other goods is , computed as… c. The slope of the budget line is per unit of housing, compared to if vouchers don’t affect housing prices. d. Given the price effects of a voucher program, the typical recipient would be [better, worse] off with public housing because…
Chapter 15, Problem 6(choose chapter or problem)
The Price Effects of Vouchers and Recipient Welfare
Using Figure 15–4 as a starting point ( v is the voucher point and j is the public housing point), suppose the $300 program increases the price of housing, from $1 to $1.50 per unit of housing.
a. Draw the voucher budget line with a housing price of $1.50.
b. For a household that chooses 300 units of housing service, its spending on all other goods is _____ , computed as…
c. The slope of the budget line is _____ per unit of housing, compared to _____ if vouchers don’t affect housing prices.
d. Given the price effects of a voucher program, the typical recipient would be [better, worse] off with public housing because…
Questions & Answers
QUESTION:
The Price Effects of Vouchers and Recipient Welfare
Using Figure 15–4 as a starting point ( v is the voucher point and j is the public housing point), suppose the $300 program increases the price of housing, from $1 to $1.50 per unit of housing.
a. Draw the voucher budget line with a housing price of $1.50.
b. For a household that chooses 300 units of housing service, its spending on all other goods is _____ , computed as…
c. The slope of the budget line is _____ per unit of housing, compared to _____ if vouchers don’t affect housing prices.
d. Given the price effects of a voucher program, the typical recipient would be [better, worse] off with public housing because…
ANSWER:Step 1 of 5
Given:
Household income is $800. The fair market rent is $540 (a dwelling with 540 units of housing service). The face value of the voucher is $300, and the housing price has increased from $1 to $1.5 per unit of housing service.