Increase in Housing Demand in Britain versus the United States. Suppose that in boThBritain and the United States, the initial equilibrium price of housing is $200,000. Britain has more severe...

Increase in Housing Demand in Britain versus the United States. Suppose that in boThBritain and the United States, the initial equilibrium price of housing is $200,000. Britain has more severe restrictions on residential development in the short run. Suppose the demand for housing increases by the same amount in the two countries.

a. Draw a set of supply and demand curves showing the effects on housing prices in the short run.

b. Suppose the long-run supply curves in the two countries have the same slope. Show the long-run effects of the increase in demand.