If the Number of Buyers in the Housing Market Decreases

question 113

Multiple Choice

If the number of buyers in the housing market decreases, what will happen?

• A) Demand in the market will increase.
• B) Demand in the market will decrease.
• C) Supply in the market will increase.
• D) Supply in the market will decrease.

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Definitions:

Interest Rate

The cost of borrowing money, typically expressed as an annual percentage of the principal.

Loanable Funds

Funds available for borrowing, which consist of household savings and international capital flows.

Compounded Annually

Refers to the process of calculating interest on both the initial principal and the accumulated interest from previous periods on an annual basis.

Interest

The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.