Sub: Economics Topic: Micro Economics
Question:
With populations growing, an increasing number of people are choosing to live in multifamily
dwellings including apartments and condos. According to the U.S. Census Bureau’s 2003
American Housing Survey, of 105.842 mill occupied housing units, 64% were single family
detached homes, and 5% were in condos and cooperatives. Condos & cooperatives have rules
that specify the rights & obligations of the owners & residents.
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(a)By considering the demand & supply of land, explain why condos are becoming relatively
more popular?
(b) Give examples of negative externalities that condo residents can generate for one another?
(c) Should the law require the residents of a condo to comply w/ the condo rules?
(d) Some residents in a condo are annoyed by the barking of other resident dogs, How could
they jointly resolve this externality?
Solution:
Brokerage business denotes a firm or a person acting as intermediaries between the buyers & sellers.
Usually, business brokers are paid with a fee or commission for the business transactions created by
them. There exists a business rationale for the above mentioned strategy. The acquired firms are able to
get a premium on each order of $100. This premium payment acts as an incentive for the acquired firms
& they will be motivated to get more orders for the acquiring firms. Actually brokerage business is
mainly based on commission payments. So, the above mentioned circumstances are met in the
brokerage business.
** End of the Solution **
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