In recent years, more and more HK people have gone to Shenzhen to shop on weekends. It has been reported that the prices of goods are lower in Shenzhen.
The sales revenue of retailers in the northern New Territories, such as Sheung Shui and Fanling, has greatly decreased over the same period. The prices of goods sold are keept fixed.
i) What is the impact on the equilibrium rental rate of the shops in the area and the total rental income from them?
F.4 econ
2007-11-15 4:55 am
回答 (1)
2007-11-15 10:00 pm
✔ 最佳答案
The equilibrium rental rate of the shops will fall as more and more retailers will close their business hence decrease in demand on shops. This will shift the demand curve to the left, thus reducing equilibrium rental rate and equilibrium quantity of shops. The rental income will also be fallen.
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