contestada

The demand for single-family homes decreases because of a decline in the number of new buyers. At the same time, the supply of homes decreases because of a decrease in the number of firms in the home-building industry.
As a result of these two changes in the market,____________

Respuesta :

Answer:

The correct answer is: The quantity of homes sold will decrease, but the effect on the price of homes cannot be predicted.

Explanation:

Given a market of houses where the quantity demanded decreases because of the dwindling in the number of new buyers, by demand law, the price of the houses is likely to increase. However, if the number of housebuilders decreases in the same market, by supply law, the supply will drop so the prices are supposed to drop as well.

Thus, it is a fact that the number of houses sold will dwindle since there are fewer houses offered and fewer potential buyers but the price of the remaining houses available is uncertain.