Consider a local bank whose mortgage interest rates are falling. Will this directly translate to greater demand for houses? Why or why not?(1 point)

Question

Responses

No, a creditor's falling interest rate translates to a greater demand for a loan from that creditor.
No, a creditor's falling interest rate translates to a greater demand for a loan from that creditor.

Yes, low interest rates in a particular sector (housing, automotive, etc.) always increase demand for the product.
Yes, low interest rates in a particular sector (housing, automotive, etc.) always increase demand for the product.

No, a rising interest rate will translate to a greater demand for houses. It is an indicator that the housing market is in short supply.
No, a rising interest rate will translate to a greater demand for houses. It is an indicator that the housing market is in short supply.

Yes, when a bank offers a lower interest rate on mortgages, then the demand for houses will increase.

Answer 1

The most accurate response is:

Yes, when a bank offers a lower interest rate on mortgages, then the demand for houses will increase.

Lower mortgage interest rates typically make borrowing cheaper for homebuyers, allowing them to afford larger loans or lower monthly payments. This can stimulate demand for houses as more people may be inclined to purchase homes due to the reduced cost of financing.