Suppose there is a shortage of a product (apartments) but the law forbids any increase in its price (rent). What would be the results of such a situation?

With the current shortages of apartments, the law that has been passed has forbids any increase in the rent. With the situation present the supply appears to be low, and thus causing an inventory shortage. Theoretically, when supply exceeds demand, sellers must lower prices to stimulate sales; on the other hand, when demand exceeds supply, buyers tend to raise the prices up, as they compete to buy and sell. And, that being the first thing that sellers would tend to want to do. Price in this circumstance still has to be kept the same along with quantity. But quality may fluctuate according to improvements and location. Although demand for apartments will rise, not necessarily evenly with its supply when a shortage like this is present.

The low supply of apartments can be

Circumstances might make the value of apartment rise or lower, with such variables like an improvement, location, economic situation, taste/preference, or a change in the population. With a set market price not allowed to change, there could be severe loss, for a commonalty of reasons such like: a wrong forecast for the market, a possible economical recession, an aggressive competitive demand time, ECT. Will be lead to a loss.

Therefore in the absence of an agreed equilibrium between supply and demand, government and individuals, factors that satisfy a particular want or need cannot be used to satisfy other wants or needs. And in contrast, when demand exceeds supply, and a rise in the price is not an option, alternatives should always be kept readily to use, for a situation to like this. And careful forecasting of the economy and the market are instantaneity quite important to do with much attention and caution, so the best can be made of the situation.

The demand will be expected to rise sin

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