1. The problem asks: Who would be harmed by a Type I error in the context of a city and homeowners? 2. A Type I error occurs when a true null hypothesis is incorrectly rejected. In practical terms, it means concluding there is an effect or difference when there actually isn't one. 3. In this context, if the city makes a Type I error, it might wrongly deny help to homeowners who actually qualify or need it. 4. This would harm the citizens of the city because they lose help they could have used to buy a home. 5. Therefore, the correct answer is: **B. The citizens of the city, because they lose help they could have used to buy a home.**