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

question 17

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) Each of these answers is correct.

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Definitions:

Population Averages

Statistical measures that summarize the central tendency of the characteristics of all individuals within a defined group.

Good Estimates

Approximations or judgments that are considered to be close to the actual value or outcome, often based on some form of logical reasoning or previous data.

Statistically Significant

A determination that the results observed in data are unlikely to be due to chance alone, according to a predefined threshold of probability.

Sample Averages

This refers to the mean value calculated from a sample of data, representing the central tendency of the sampled population.