Based on the Rising Housing Prices of 2000-2005, Many Buyers

Multiple Choice

Based on the rising housing prices of 2000-2005, many buyers opted for interest-only loans and variable rate mortgages with little or no down payment because

A) they expected short-term interest rates to fall substantially in the future and this would reduce their monthly mortgage payment in the years ahead.
B) variable rate mortgages are a good way to reduce the risk accompanying your investment when you plan to stay in the house for a long time.
C) they thought housing prices would continue to rise and therefore they would be able to sell the house for a profit within a couple of years.
D) they could easily recoup their investment, even if there was a downturn in housing prices in the future.