using the above information, which kind of investor would likely turn the greatest profit in this market…

using the above information, which kind of investor would likely turn the greatest profit in this market, given that each of them purchased a house in this area at year 0?\na. a long - term investor, who wishes to hold onto the house for an extended period and rent it out in the meantime.\nb. a house flipper, who will sell the house as soon as the market increases its value.\nc. a moderate - term investor, who will sell the house once it reaches a certain price.\nd. a cautionary investor, who will sell the house in order to minimize losses as soon as the prices begin to drop.

using the above information, which kind of investor would likely turn the greatest profit in this market, given that each of them purchased a house in this area at year 0?\na. a long - term investor, who wishes to hold onto the house for an extended period and rent it out in the meantime.\nb. a house flipper, who will sell the house as soon as the market increases its value.\nc. a moderate - term investor, who will sell the house once it reaches a certain price.\nd. a cautionary investor, who will sell the house in order to minimize losses as soon as the prices begin to drop.

Answer

Brief Explanations:

  • A long - term investor (option a) can benefit from the overall upward trend of the market over an extended period. By holding the house and renting it out, they can generate income in the short - term and also gain from the long - term appreciation of the property value.
  • A house flipper (option b) depends on quick market value increases. However, the graph shows fluctuations, and a quick - sell strategy may not capture the full long - term growth.
  • A moderate - term investor (option c) selling at a certain price may miss out on further long - term growth if the price continues to rise after their target price.
  • A cautionary investor (option d) selling at the first sign of a drop will likely miss out on the long - term upward trend of the market.

Answer:

A. A long - term investor, who wishes to hold onto the house for an extended period and rent it out in the meantime.