Pays interest at the market interest rate of 4 percent. is, Ask an Expert

Economics

John and Mary each buy a new house for $400,000. Mary pays cash. John borrows the full $400,000 from the bank and pays interest at the market interest rate of 4 percent. Is it correct to say that the cost to Mary of living in her house is less than the cost to John? Why or why not?

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M942221

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