Assume that the housing market is in equilibrium in year 1. In year 2, the mortgage rate that banks charge consumers decreases, but producers are not affected. Also in year 2, the cost of lumber used to build homes decreases. Which of the following is most likely to be the equilibrium change?
Assume that the housing market is in equilibrium in year 1. In year 2, the mortgage rate that banks charge consumers decreases, but producers are not affected. Also in year 2, the cost of lumber used to build homes decreases. Which of the following is most likely to be the equilibrium change?
a
The equilibrium will be at point C before the change in expectations and point B after the change
b
The equilibrium will be at point A before the change in expectations and point B after the change
c
The equilibrium will be at point A before the change in expectations and point E after the change
d
The equilibrium will be at point E before the change in expectations and point A after the change
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