AICPA Exam CPA-Business Topic 1 Question 107 Discussion

Actual exam question for AICPA's CPA-Business exam

Question #: 107
Topic #: 1

[All CPA-Business Questions]

A city ordinance that freezes rent prices may cause:

AThe demand curve for rental space to fall.

BThe supply curve for rental space to rise.

CThe quantity demanded of rental space exceeds the quantity supplied.

DThe quantity supplied of rental space exceeds the quantity demanded.

Show Suggested Answer

Suggested Answer: C

Choice 'c' is correct. Return on investment equals net income divided by average invested capital:

Choices 'a', 'b', and 'd' are incorrect, per the above calculation.

by Emerson at Feb 07, 2025, 08:11 PM

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2 days ago

But wouldn't it also lead to the quantity demanded exceeding the quantity supplied?

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3 days ago

I think a rent freeze may cause the demand curve to fall.

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