Problem related to mortgage rates
Problem:
If mortgage rates raise from 5% to 10%, but the expected rate of increase in house prices rises from 2% to 9%, are people more or less likely to buy houses? ( Show your work to receive full credits).
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If mortgage rates raise from 5% to 10%, but the expected rate of increase in house prices rises from 2% to 9%, are people more or less likely to buy houses?
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