Housing Subsidy Programs and Locational Choices Title: Housing Subsidy Programs and Locational Choices 1) In the absence of amenities, the poor income group would most likely locate in low-cost, smaller houses. This is because their limited

answer length one (1) page for each questions 
1) Assume there are three income groups in a city: poor, middle-income, and the rich. In the absence
of amenities (i.e., utility is a function of only the house size and bread consumption), explain where
each group locates and why. Now assume amenities are included in the utility function. What
determines where each group will locate now?
2) Compare and contrast the four housing subsidy programs we discussed in class. How does each
work, how do they affect low-income household utility, and how well do they mitigate slums?