...Xeco/212 Page 1 A New House: Readiness Xeco/212 Angela Rogers Due: Friday May 24, 2103 Pamela Hammock Xeco/212 Page 2 I feel that purchasing a new home is one of the biggest decisions a family can be faced with. I know that because of the person that I am the main principle I would use when purchasing a new home is the second one, which was the cost of something is what you give up to get it. However it would be safe to say that a decision this big over a period of time would at some point factor in all 10 of the principles. I feel this way because you never know what the future may hold and if you were to make any mistakes when making this decision it could create all kinds of financial problems. If I were making a decision like this I would have to take several things into consideration. One of the things I would consider is the timing. I would want to take baby steps or so to speak, like building smaller goals and going for those first until I reach the final goal of purchasing the home. I would have to weigh my options as whether to buy a house or renting a bigger apartment would be better than the small studio. Yes we would definitely need something bigger with a baby on the way. Another thing to consider is where you would want to send your child to school especially if you are purchasing a home. You would also have to consider the economy and how the real estate market is holding up. You would not want to buy a house and then the value decrease...
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...Xeco 212 Checkpoint: a New House – Readiness Checkpoint: A New House – Readiness Leonard Sugue University of Phoenix XECO 212 Economic Theory Audra Sherwood February 17, 2011 A New House – Readiness Deciding to buy a house is a lifelong goal for many people. Imagine that you are renting a studio apartment and have just discovered you are having a baby. Your present apartment is small and far from schools and local services. You have decided to move. There are many factors that come into play when making such a large and weighty purchase. Examine the decision-making process from the perspective of an economist. In your Final Project, you use these principles and other factors to make a final decision whether to buy a house. Purchasing a home for the first time can be overwhelming. A house can be the largest investment someone makes. It can provide advantages, but it can present disadvantages as well. The following principles can be used when deciding to purchase your first home: People Face Trade-offs (Mankiw, 2007) The Cost of Something Is What You Give Up to Get It (Mankiw, 2007) When deciding to purchase a home, the principle “People Face Trade-offs” can be applied to help make a final decision. Making decisions requires trading off one goal against another (Mankiw, 2007). The buyer must sacrifice a little to gain a lot. First time home buyers must realize that it takes a lot of money to purchase a home. Buyers must sacrifice...
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...A New House Readiness Susan Whitebird XECO/ 212 April 5, 2012 Linda Beach The decision to buy a house or not is one of the biggest life changing decisions you can make. If there is more than one person involved in this decision to purchase a house they will experience the first principle of economics, people face trade-offs. What means more the price of the house or the location of it? I think that the location means more than the price, but you have to keep the price in mind when you are looking. How far are they willing to travel to work to get the home they want? When my husband and I bought our house I was willing to drive 50 miles a day round trip to and from work to get the home my husband and I fell in love with. The second principle of economics is also important when it comes to purchasing a home. The cost of something is what you give up to get it. We were paying $450.00 a month in rent and now we are paying $610.00 a month for our house payment. We had to pay off some of our other loans and we have to watch what we spend our money on to make up the difference of the rent and what our house payment is, but it is worth it. Most people will consider the fourth principle of economics when they buy their home. The fourth principle is people respond to incentives. When you own your own home it will provide you with a tax break when you file your taxes. We bought our house when there was a tax incentive of a 10% of the purchase price. This tax incentive...
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...1 Supply and Demand Jesse Cisco XECO/212 8/13/2012 Jaime Medina Supply and Demand 2 I have chosen to write about purchasing a computer. There is such a variety of computers and with technology improving every day, many factors are encouraging or discouraging people to buy them. For example, when I bought my new computer I was very specific on what I was looking for in a new computer. I wanted a lot of memory, a very large monitor, and it had to have windows 7, and of course the price had to be reasonable. As a consumer, once I found a computer that had all these aspects, I purchased it without a second thought. There are factors that change the supply and demand curve for any good or service offered to consumers, this is what makes the manufacture know how much to sale and at what price. There are many aspects that could affect the demand of computers, for instance there would be a greater demand for computers when college started up. Consumers would be more willing to buy because they need to have computers to complete their school work. You might see a negative change in demand when college is on summer break and students are not worried about purchasing a computer. The holidays would show an upward change in the demand curve, because of the purchasing of computers as gifts. The sales during the holidays would have consumers willing to buy computers. Factors could also positively and negatively affect the supply curve as well. Price of manufacturing...
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...MARKET STRUCTURES Bart Ford XECO 212 Jan. 15, 2012 Dr. Jill Trask Abstract Before someone can identify how to maximize profits in different market structures they must first understand how those markets operate and the characteristics of each. This paper will identify three market structures monopoly, oligopoly, and competitive structures and explain each in detail, as they pertain to maximizing profits, how price is determined for goods, how output of goods is determined, barriers of entry into each market, and the role that each market plays in the economy. UNDERSTANDING MARKET STRUCTURES A monopoly structured market consists of one provider for a particular good or product. A monopoly exists when one firm controls a specific resource, such as diamonds. Diamonds are very rare and scarce as a resource, subsequently if one firm were to control the vast resource of diamonds they would inevitably control the market sale of diamonds. In this way, the diamond firm would be able to set the price for diamonds at whatever they wished. Also, by doing this the firm can look into ways to cut costs related to gathering the diamonds for sale. The firm could cut back on labor costs and only use minimal amounts of labor because they can control the output during any and all stages of the production phases. Barriers of entry into the monopolistic structure are great, and include: exclusive patent rights, extremely high initial start-up costs, economic, social, and political impediments...
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...CheckPoint: A New House – Readiness Principles of Economics XECO/212 Purchasing a first home is the biggest financial decision most people make in their lifetime. There are several factors to consider, and people who make this purchase must thoroughly review the risks and benefits. When my husband and I chose to buy our first home, we considered three economic principles: the decision-making principle of People Face Trade-Offs, the interaction principle of Trade Can Make Everyone Better Off, and the workings of the economy principle of Prices Rise When the Government Prints Too Much Money. We knew we would have to give up going out to eat or to the movies as often. Our mortgage payment is higher than our rent payment was, so we had to cut back on non-essentials; this was a trade-off we were willing to make The interaction and workings of the economy principles created a challenge. Home prices were inflated at that point, because of unethical loan. In this case, trade did make everyone better off, but only on paper. We knew we had to be careful of how we structured our mortgage so we were not in financial danger as the housing market fell. This required a lot of homework to make sure that we could meet these new obligations, and that we did not let our emotions make our decisions. The marginal benefit to us during the home search was that so many homes were available, and the marginal cost was the difference between our rent...
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...Checkpoint A/New House Germaine Dancer 1/13/12 XECO 212 Annie Moats My husband and I are looking to buy a bigger house this year or early next year. What we are doing is cutting back on what we are spending on things. So principle 1: People Face Trade-offs. We are not taking a trip this year or spending unnecessary money. We are just spending what we need like food, things like for the baby and the other kids. We have started to take our lunch to work with instead of buying lunch at $10.00 a day. We have been cooking dinner and breakfast almost every day. That saves money to. I’m in school and that is taking up a lot of my extra money, but the payoff is going to be good. Another principle 6: Markets Are Usually a Good Way to Organize Economic Activity. The market economy is an economy that allocates resources through the decentralized decisions of many firms and households as they interact in markets for goods and services. I really like this one Firm decide whom to hire and what to make. Households decide which firms to work for and what to buy with their incomes. These firms and households interact in the marketplace, where prices and self interest guide their decisions. They are saying as a household we decide what we buy and how much we are will to pay. Because if something is too high we want buy it and the companies lost out. But if the prices are right we will buy it all the time. Just like when you buy a house, if the house is too much in this day of age the house...
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...CheckPoint - Money Steven A. Tijerina XECO/212 Principles of Economics April 21, 2012 Jason Kelley Money Moneys acts as a unit of account by providing a measure of the value of exchanged services and goods. Understanding monetary value enables suppliers and purchasers to make sound decisions on the number of goods to purchase and the number of goods to supply. Money is used as a medium of exchange when completing any financial transactions, for example, if money did not exist then the only recourse would be to barter by directly exchanging goods and services. The downside of bartering to obtain a good you must have a good of equal value that the other party wants or needs. Another flaw to bartering is the double coincidence of wants, which makes transactions much more difficult to complete because one party does not need what the other party has. Money eliminates the barter system because money is used as a medium of exchange for transactions by all the parties involved. Store of value is a medium of exchange only when money retains its value, in other words, $1000 in the present economy retains the same monetary value 10, 15, 20 years down the line; however, inflation and cost of living decrease the value of money as prices rise. Money is not the only store of value, for example, others include artwork, postage stamps, gold, and land or similar valuable goods. Money is liquid compared to other mediums...
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...Principle of Supply and Demand Theresa "Terri" Williams XECO 212 January 11, 2013 Hamsa Wilson Principle of Supply and Demand. In this paper I will decide which principle plays a major role in my decision of buying a house. I will provide examples for each showing the interaction, decision making and the workings of the economy that I have made to decide which and where I buy a home. I will explain how the influence the marginal benefits and marginal cost associated with the decision to purchase a house. The first important principle that I would use is the second principle which states The Cost of Something is what You Give Up to Get It. I believe in this principle that needs a house you would have to save up and make sure you can afford it later in the years to come. This principle for example you would have to decide in years to come what is important the most a car to get around or a house to live in with your family. This principle also would be where you would decide in the house what you need or you do not. The next principle would be six which is Markets Are Usually a Good Way to Organize Economic Activity. I believe that this one would be important also because when you buy a house you would have to decide the market and where you want to live if deciding to get loans you would have to decide how to pay them off over the years. The last thing I will discuss about buying a house would be inflation, marginal benefits and marginal cost that is associated...
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...Checkpoint: A New House – Readiness Leonard Sugue University of Phoenix XECO 212 Economic Theory Audra Sherwood February 17, 2011 A New House – Readiness Deciding to buy a house is a lifelong goal for many people. Imagine that you are renting a studio apartment and have just discovered you are having a baby. Your present apartment is small and far from schools and local services. You have decided to move. There are many factors that come into play when making such a large and weighty purchase. Examine the decision-making process from the perspective of an economist. In your Final Project, you use these principles and other factors to make a final decision whether to buy a house. Purchasing a home for the first time can be overwhelming. A house can be the largest investment someone makes. It can provide advantages, but it can present disadvantages as well. The following principles can be used when deciding to purchase your first home: People Face Trade-offs (Mankiw, 2007) The Cost of Something Is What You Give Up to Get It (Mankiw, 2007) When deciding to purchase a home, the principle “People Face Trade-offs” can be applied to help make a final decision. Making decisions requires trading off one goal against another (Mankiw, 2007). The buyer must sacrifice a little to gain a lot. First time home buyers must realize that it takes a lot of money to purchase a home. Buyers must sacrifice things such as vacations, movies, special occasions, and...
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...A New House-Economy Checkpoint Chante Yokley XECO/212 December 11, 2011 John McGee A New House-Economy The FED impacts national fiscal policies through interest rates, which impacts the demand in the housing market (Mankiw, N. G., 2007, p. 657). The Department of Treasury introduced a refinancing program that allows consumers to refinance mortgages to take advantage of lower interest rates. The Fiscal Policy impacts prime lending rates, which are the determining factor in consumer borrowing. The higher lending rates mean a higher price paid for a new home. As rates increase, demand decreases causing a decline in the housing market and an overall lag in the economy. A contractionary fiscal policy would provide a short-term decrease in the money supply but would provide lower inflation in the long-run, reducing lending rates and increasing the aggregate demand in the housing market (Mankiw, N. G., 2007, p. 778, pp. 5). The strength of the economy would create an increase in marginal benefits, exceeding marginal costs by strengthening home owner’s equity. The government offers programs and tax incentives (deductions) that subsidize home ownership, making it affordable to be a homeowner. One in particular is the Mortgage Interest Deduction (MID), a popular tax break for middle to higher class citizens; research shows that the beneficiaries from the MID are in these societal classes (Stansel, Dean & Randazzo, Anthony, 2011, executive summary, p. 6). There...
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...A New House Mark Anderson XECO/212 April 5, 2013 Anna Gonzalez A New House One government body that influences national fiscal policies is the Federal Reserve. The Federal Reserve is the central banking system of The United States. The Federal Reserve influences the interest rates on home loans through the buying and selling of bonds and securities. If the Federal Reserve purchases a large amount of bonds and securities interest rates on home loans will lower; causing a rise in home sales. A recent national fiscal policy that effected mortgage rates, housing starts and housing prices is the bond buying stimulus plan that the Federal Reserve implemented in 2008. The bond buying stimulus plan is a plan where the Federal Reserve purchases bonds in an effort to keep long-term rates down. The bond buying plan was started in an effort to help spur investment and consumption in the economy. There was a drop in interest rates shortly after the implantation of the Federal Reserves new policy. A rise in housing starts and home sales can be attributed directly to the lowering of interest rates. When it comes to weighing the risks and benefits of purchasing a home I would recommend a person find out as much information as they could on their own before consulting a professional. They should look at interest rates and determine if they are trending up or down. Look to see if the Federal Reserve is buying or selling bonds and securities in order to help...
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...A New House-Risks and Benefits Jocelyn D. Mack XECO/212 March 13, 2016 Angela Semexant A New House-Risks and Benefits The housing market of the United States is still a volatile issue with many Americans that want to become home owners. With the housing market depression of a couple of years ago, there are many different factors that contribute to a person’s ability to be a home owner. The Federal Reserve is the main controlling body of the government that decides if interest rates for borrowing money for any reason including home loans moves either up or down. The Central Bank and the Federal Housing Finance Agency play active roles to either increase or decrease the demand for housing. It is the cycle of supply and demand of available monies, mortgage rates, and housing prices. When the Federal Reserve either holds the interest rates or move them downward, the demand grows in the housing market. This is considered a monetary policy stimulus overseen by the Central bank and the FHFA. The consumer has more buying power for the size home they want to live in to raise their family or as an investment in their later years. Today’s housing market is offering up any number of price points in either present homes on the market, or new housing starts. The job market has somewhat stabilized with unemployment being at a very low point. Two income families have begun to move upward in their earning power with contributions from retailers holding their pricing on everyday...
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...A New House and the Economy XECO/212 A New House and the Economy The decision to purchase a new home is a significant one to say the least. With the current conditions of the economy the decision should be calculated down to the very last detail. The consequences of purchasing a new home will have a direct affect on the rest of your life, so the choice to purchase a new home should be one made with confidence and plenty of knowledge. You must take into account all the variables that will come into play such as the economy, the market, interest rates, housing prices, and most important your financial and employment status. The current status and strength of the economy and your personal standings will affect the marginal benefits and costs in the decision of purchasing a new home in many ways. One aspect is how well your finances are and how they may be in ten or twenty years and will you have job security still in place in as little as five years. This long term purchase will also be affected by the marginal costs and benefits of purchasing the home. The marginal costs would be the payment, the insurance, the maintenance and the interest rate. The marginal benefits would be that this purchase is an investment if the circumstances are right, the economy is healthy and your job is secure. The location in relation to schools, jobs, and other daily activities will also play a part in the decision and its benefits (Mankiw). Currently the housing interest rates are low...
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...Week 5 – A New House – Risks & Benefits Kathleen Butcher XECO/212 – Principles of Economics 02/9/13 Tonya Wilhelm When purchasing a new home there are many things to consider. Reviewing the risks and benefits when thinking about making a life changing purchase of buying a home can help you determine when is the right time for you. There are multiple government departments that can impact the national fiscal policies but the one that has the potential for the biggest impact is the Federal Reserve. The Federal Reserve is the one that decides if the interest rates increase or decrease based on what the market is doing. There are multiple policies that can have an influence on the different parts to consider in buying a home, such as, mortgage rates, housing starts, and housing prices. The first thing to look at as a consumer is the lending rates. This rate helps lenders decide if they will borrow money from the Federal Reserve to have money to put into mortgages and housing starts. The higher the interest rates, the higher the cost of buying a home will be. If the interest rates get to be too high, the housing market will become stagnant and cause issues in the economy. The suggestion that I would give to someone looking at buying a home would be to analyze the risks and benefits of purchasing a home. There are so many considerations to take into account for first time buyers and people looking to refinance. When purchasing a home there are people who...
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