How Are Housing Starts, or New Construction, Used to Gauge

question 18

Multiple Choice

How are housing starts, or new construction, used to gauge the national economy?

• A) Construction of apartments instead of single family homes indicates less money available in the economy.
• B) Declines in housing starts are often one of the first signs of an approaching economic downturn.
• C) Building supplies are the most profitable industry in the nation.
• D) Decreases in demand for single-dwelling homes usually indicate a higher demand for condominiums and other multiunit construction.
• E) Decreases in the average price of new homes indicate a strong economy.

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Definitions:

Secondarily Liable

Refers to a party who is indirectly responsible for a debt or obligation, where primary liability lies with another party, but the secondary party may be called upon to fulfill the obligation if the primary fails to do so.

Collateral

Assets that are pledged as security for the repayment of a loan, which can be seized by the lender if the borrower fails to repay the loan as agreed.

Primarily Liable

Refers to the party who holds the initial or most significant responsibility for fulfilling an obligation or debt.

Lien

A legal right or claim against a property by a creditor, ensuring payment of a debt or fulfillment of an obligation.