Housing policy analysts debate the best way to increase the number of housing units available to low-income households. one strategy—the demand-side strategy—is to provide people with housing vouchers, paid for by the government, that can be used to rent housing supplied by the private market. another— a supply-side strategy—is to have the government subsidize housing suppliers or to build public housing.

a. illustrate supply- and demand-side strategies using supply and demand curves. which results in higher rents?

b. criticsofhousingvouchers(thedemand- sidestrategy) argue that because the supply of housing to low-income households is limited and does not respond to higher rents, demand vouchers will serve only to drive up rents and make landlords better off. illustrate their point with supply and demand curves.

Example1 lcnrv: ted company uses the lower of cost or nrv method in valuing its inventory items. the inventory at december 31, 2017, consists of products a, b and c, each having 1,000 units. relevant unit data for these products appear below: item a item b item c cost $ 80 $80 $80 estimated selling price 180 100 90 estimated selling cost 30 30 30 required: using the lower of cost or net realizable value rule, determine the proper value of inventory for balance sheet reporting purposes at december 31, 2017. prepare any necessary journal entry. apply the lower of cost or nrv method: • on an individual inventory basis; • on a group basis; • on a total inventory basis. solution worksheet: inventory (on an individual basis): inventory value item nrv cost lc- item a item b item c total inventory (on a group basis): inventory value item nrv cost lc- group 1 (item a and b) group 2 (item c) total inventory (on an aggregate inventory basis): inventory value item nrv cost lc- total inv