When interest rates are ______, buyers are often priced out of the market.

• A. falling
• B. high
• C. low
• D. unchanged

Answer: (B)

Verified step by step guidance

1. Understand the relationship between interest rates and buyers' ability to afford purchases, especially in markets like housing or durable goods where financing is common.
2. Recall that when interest rates are high, borrowing money becomes more expensive because the cost of loans increases.
3. Recognize that higher borrowing costs mean monthly payments or total costs rise, which can reduce the number of buyers who can afford to enter the market.
4. Therefore, when interest rates are high, some buyers are effectively priced out of the market because they cannot afford the higher financing costs.
5. Conclude that the correct completion of the sentence is 'high' because high interest rates limit buyers' purchasing power.