Problem
1. Suppose prospective buyers of houses become very optimistic about the future prices of houses. Existing owners, on the other hand, become very pessimistic about the future value of houses. What happens to the price of houses today?
2. Suppose housing markets are efficient. If you see rapidly increasing prices in a market, do you think that rental rates are increasing as well?
3. Explain how contractionary monetary policy can reduce housing prices.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.