Essay about Eco 372 Week 2 Product Purchases & the Economy

Words: 1075
Pages: 5

Product Purchases and the Economy


October 12, 2015
Product Purchases and the Economy

A new car purchase is one that takes a large amount of consideration and budgeting. The most important economic indicators to consider when investing in an automobile purchase are unemployment rates and interest rates. These indicators will assist a person when deciding whether to purchase new or used. Is the right time now or later to purchase a truck?
Economic Indicators The automotive sector is a cyclical business. Since it is a cyclical business, changes in the revenues and earnings of automotive companies are more likely due to the state of the economy and the strength of the consumer. Sales in the automotive sector
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Understanding the concepts of macroeconomics Macroeconomics affects everyone. Everyone is affected in some way by macroeconomic issues such as inflation and unemployment. Inflation can reduce the value of your savings.
The concepts of macroeconomics are a foundation of a purchasing decision. People can’t buy what they can’t afford no matter how badly they need it or want it. However, affordability is often a matter of perspective. Consumers should use an intense system of thorough investigation before deciding to purchase. A consumer’s demand depends on income and a producer’s supply depends on the cost of producing the product. The demand curve shows the quantities of a particular good or service that buyers will be willing and able to purchase at each price during a specified period. The supply curve shows the quantities that sellers will offer for sale at each price during that same period. By putting the two curves together, we should be able to find a price at which the quantity buyers are willing and able to purchase equals the quantity sellers will offer for sale. The economy as a whole is negatively impacted by economic cycles. When times are bad, people tend to cut back on purchases. In addition to manufacturers, financial institutions are susceptible to declining demand for financial