Question: 1. Suppose people expect housing prices to decrease in the near future a. What would be the major effect? - Increase in demand for loanable

1. Suppose people expect housing prices to decrease in the near future

a. What would be the major effect?

- Increase in demand for loanable funds

- Decrease in demand for loanable funds

- Increase in supply of loanable funds

- Decrease in supply of loanable funds

b, Why is so?

c, Graphically illustrate the effect on the equilibrium interest rate and quantity of loanable funds

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