A Study Prepared for the National Association of Realtors Estimates

Multiple Choice

A study prepared for the National Association of Realtors estimates that the number of housing starts per year over the next 5 yr will be million units, where r (percent) is the mortgage rate. Use differentials to estimate the decrease in the number of housing starts when the mortgage rate is increased from 17% to 17.2%. Round to the nearest unit.

A) 12,567 housing starts
B) 12,819 housing starts
C) 12,362 housing starts
D) 11,956 housing starts