An expectation that the price of housing will increase more rapidly in coming years will cause the:

Question

Quizplus · Accepted Answer

If people expect the price of housing to increase more rapidly in the future, they will want to buy a house sooner rather than later to avoid paying more later. As a result, the demand for houses today will increase. This would cause an increase in prices, but it is not reflected as a decrease in supply. Therefore, option (B) is the correct choice.

An Expectation That the Price of Housing Will Increase More