Why did the housing boom of 1997 2006 show evidence of time bunching? I. As bank

Question

Why did the housing boom of 1997 2006 show evidence of time bunching?

I. As banks began to increase their portfolio of mortgage loans, more and more banks began to offer fast mortgage loans in hopes of making more profit.
II. As builders saw the increase in home building, they also jumped on the bandwagon and started building new homes in hopes of making greater profits.
III. As consumers saw other consumers purchasing houses in anticipation of rising prices, they also purchased new homes in hopes of increasing their wealth.

I only

I and II only

II and III only

I, II, and III

I only

I and II only

II and III only

I, II, and III

Explanation / Answer

Answer : Option 2 is correct. As it shows that the statement 1 and 2 are correct which shows that banks began to increase there mortgage loan and builders saw the profit in increasing the construction of the houses. Banks should provide more facilities to take the loan facility as well as builders construct the house so that they can earn maximum profit.

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