You\'ve been debating on making a purchase for yourself. This is a product you\'

Question

You've been debating on making a purchase for yourself. This is a product you've wanted for a while, but one that requires budgeting because you will be making monthly payments.

Select a product in which the demand for the product is clearly affected by the strength or weakness of the overall economy such as new homes, cars, appliances, smart phones, etc.

Write a 1,050- to 1,400-word paper in which you address the following:

Identify and define two economic indicators that reflect the strength of the economy (e.g. real GDP, unemployment rate, inflation rate, interest rate, housing starts, etc.).

With these economic indicators in mind, how has the economy affected the demand for and supply of your selected product over the last 2 years?

What was the impact on the supply of the product and the impact on the demand for the product?

Explain the impact on the price of the product and your decision on whether or not to buy the product.

Include responses to the following:

How might you apply what you learned about supply and demand to your work place or your understanding of the product you are considering purchasing?

How do the concepts of macroeconomics help you understand the factors that affect shifts in supply and demand on the price of the product?

Explanation / Answer

A new home purchases

Here I choose the product new home.

We know that the Demand and Supply is the two important indicator in Economics. We know that the demand for the product we means that it is a desired backed ability and willingness to pay. On the same way the supply of the product we means that the total amount of a specifiic good that available to sell. Here We choose the new house as a product in the market. The home is a general Economic construction. The Building is depends upon income, Jobs and taxes of the people. When the supply of new home increases the price is also increases. Incase of demand, When demand for the new home's increases the price will be decreasing. When we compare with these two terms each other, When the emand for the new house increases and lack of supply the price of new home will increase very faster.

In the last six or seven years the housing market are fluatated tremendously. Presently the demand for new houses is increased but there is no enough supply in the market. So the price of the product is increased. In the last year the home owner are not ready to sell their product. They are reluctant to sell the product. More of them are no ability to construct or purchase a new modified homes. So they are not willing to sell the product. So here there is huge competition for purchasing a new house. But the supply is very low level in the market.

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