How does the relationship between housing prices and rental rates provide evidence for or against the existence of a housing bubble?
What will be an ideal response?
The fundamental value of a house should equal the present value of housing services that homeowners expect to receive. As a result, we would expect housing prices and rental rates to increase at close to the same rate over time. If housing prices increase much more rapidly than rental rates for a considerable period of time, there may be evidence of a bubble.
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In the figure above, the economy is at an equilibrium with real GDP of $16 trillion and a price level of 110. As the economy moves toward its ultimate equilibrium, the ________ curve shifts ________ because ________
A) aggregate supply; leftward; the money wage rate rises B) aggregate supply; rightward; the money wage rate falls C) aggregate demand; rightward; the money wage rate falls D) aggregate demand; leftward; the money wage rate rises E) potential GDP; leftward; the money wage rate falls
Creating policy with the goal of increasing economic growth would be considered:
A. to indirectly help eliminate poverty. B. to indirectly hurt efforts to eliminate poverty. C. to only help if directed toward poor areas. D. None of these is true.
Monopolists usually earn economic rent
a. True b. False Indicate whether the statement is true or false
Which of the following is not one of the revenues of a typical high school athletic program?
a. local and city school taxes b. state taxes c. donations d. booster clubs e. none of these