How Did the Housing Boom of 1997-2006 Increase Aggregate Demand

question 167

Multiple Choice

How did the housing boom of 1997-2006 increase aggregate demand?

• A) It created more jobs and increased wages in the construction sector.
• B) Interest rates increased to keep pace with housing demand.
• C) More consumers saved, so they could afford the higher housing prices.
• D) Higher interest rates created a boom in the banking sector.

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Definitions:

Sale Or Return

A contract in which the seller delivers a quantity of goods to the buyer on the understanding that if the buyer desires to retain, use, or sell any portion of the goods, he will consider such part as having been sold to him, and that he will return the balance or hold it as bailee for the seller.

Risk Of Loss

Refers to the legal responsibility regarding who bears the cost of damage, destruction, or theft of goods during a transaction or after it, until delivery.

F.O.B. Seattle

A commercial term indicating that the seller of goods is responsible for them until they are loaded on board a shipping vessel in Seattle, at which point the buyer assumes risk and responsibility.

Shipment Contract

A type of agreement in sales law where the seller is responsible for delivering goods to a carrier, after which the risk of loss passes to the buyer.