You Notice That When Interest Rates Increases, New Residential Housing

question 144

Multiple Choice

You notice that when interest rates increases, new residential housing prices tend to decrease. This observation indicates that

• A) there must be false causality between interest rates and housing prices.
• B) higher interest rates must cause low housing prices.
• C) a scatter diagram between interest rates and housing prices will show a negative relationship.
• D) a scatter diagram between interest rates and housing prices will show a direct relationship.

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Definitions:

Additional Expenses

Costs incurred by a business that are not directly related to its primary operations, such as unusual or unforeseen expenditures.

Selling Model

A strategy or framework used to direct how a product or service is sold to consumers.

Credit Sales

Credit Sales are transactions where the goods or services are provided to the customer with the agreement that payment will be made at a future date.

Effect on Profit

The impact that specific actions or events have on the net income of a company.