Question

select all the correct answers. newton bay is a sparsely populated area. the government plans to build an international airport there and announces this plan publicly. when hotel chains learn about the airport, they become interested in building new hotels near the airport to accommodate travelers. what is the likely economic impact of this situation on commercial real estate in newton bay? the demand for land will increase. the price of land will decrease. the demand for land will decrease. the price of land will increase. the demand for land will not change.

Explanation:

When the government plans to build an international airport and hotel chains want to build new hotels near the airport, the demand for land in Newton Bay (for building hotels and related commercial activities) will increase. According to the basic principles of supply and demand in economics, if the demand for a resource (land, in this case) increases while the supply of land is relatively fixed in the short - term, the price of that resource (land price) will also increase. So the correct statements are that the demand for land will increase and the price of land will increase.

Answer:

• The demand for land will increase.
• The price of land will increase.