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Unformatted text preview: able to wipe people out financially due to the leveraged bets people would have to make on the swing of the housing market. Removing the deduction also means that people in lower income brackets no longer have to compete as hard with a 250,000+ annual gross income. Those who make that much money while under the interest tax deduction receive 10 times more money than one who is only making 40k per year. There are a lot of people in this day and time who purchase a home solely for resale. As government spending decreases, the economy is likely to do better because taxes will not rise. More people will get jobs as the unemployment rate drops subsequently which will lead to more people wanting to buy a home. As government spending increases and taxes need to be raised to make up the deficit, the economy declines and has the opposite effect on the housing market....
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This note was uploaded on 02/11/2011 for the course XECO 212 taught by Professor Cohen during the Fall '10 term at University of Phoenix.
- Fall '10