This website uses cookies to ensure you have the best experience. Learn more

Buy Or Not To Buy Essay

2183 words - 9 pages

A New House- To Buy or Not To Buy
March 6, 2011

A New House- To Buy or Not To Buy
Many times the way we act and the decisions that we do from day to day, are affected by economics. We use, without realizing it or realizing it, economic theories to aid in whether I make a decision or I do not make a decision. This can also be said for decisions such as to purchase a new house. This paper will evaluate how economics affect one’s decision to purchase a new house.
The decision to purchase to a new house is not an easy or small decision. It is considered to be a milestone and can be a lengthy decision to make. The reason for this falls back on the price of a house, how much you ...view middle of the document...

In this case, a large portion of one’s savings would be used when purchasing a new home. The tradeoffs in this case would be that the things they could have done with the savings that the spent to purchase the house. There are many other thing that the money that would be used to purchase a home to be used on. It could be used on buying a new car, going to college, sending a child to college, vacation, and so many other things. Due to this being such a major chunk of one’s income and/or savings, one needs to really think about the pros and cons in purchasing a home. One would want to think about the benefits of purchasing a new home which would be a new environment, assuming that it is a new home it would be cleaner which would be beneficial to your health, possibly larger space, more storage, and many other benefits. Some possible cons could be being responsible for all upkeep and repairs, mortgage payment could be higher than rent, additional costs such as homeowners insurance and many other things. Having said this, a person will only decide to purchase a home when he or she is fully ready to accept all the advantages and disadvantages that come along with making this type of a decision. After all it is not like buying a pair of jeans and deciding they just do not fit right and take them back to the store.
The next principle I will use to apply to the decision to purchase a new house can be found in Principle number 2: The Cost of Something is what you give up to get it. In this principle the text mentions “opportunity costs”. The text describes this “The opportunity cost of an item is what you give up to get that item (Mankiw, 2007).” Opportunity cost refers to the value of the next best alternative which one has to give up. This would include both explicit and implicit costs. Explicit costs, in the case of purchasing a new house, mean the total amount of money that one would spend on a new home. With implicit costs, this covers all the non-monetary costs. For example, it could be things like, familiar (maybe even good) neighbors or even the loss of bonding time should the choice had been a nice family vacation. Marginal costs and benefits will be the next principle of economics we will be applying to the purchase of a new home. When one is in the position of making a decision, the decision will only be made if the marginal benefits are greater than the or at least equal to the marginal costs. In this scenario, some marginal benefits that could accompany the decision to purchase a new home could include being in a better area, closer to school or in a good school district, and local services. Another principle of economics that I would apply to the decision to purchase a new home would have to be the incentives in which one is presented with. If one was to purchase a new home, for example, they could be entitled to a tax credit reduction. Another incentive would be the first time homebuyer tax credit. However, there can be a downside to...

Other Essays Like Buy or Not to Buy

What Motivates Customers to Buy Products

1674 words - 7 pages , prestige and status. The fifth call was self-actualization, which is self-fulfillment (Pride and Ferrel, 201). Recommendations and rationale People or consumers have motives for the reasons they purchase or buy products and services. Customers’ motives to buy products can either be emotional or quite rational. In most cases, consumers do not think about what motivates them to buy certain products and leave others, but there is always an

How to buy a car stereo

741 words - 3 pages      Nearly everyone who has sat in traffic has noticed the mind numbing amounts of bass produced by some car stereos. What most drivers aren’t aware of is how to buy a system of sub-woofers for their own car. The most noticeable feature of these systems is their price which is limited only by human imagination. The most basic understanding of how much these systems cost, although varied by complexity and brand name

To Drill or Not

731 words - 3 pages To Drill or Not Christy Capps To Drill or Not Rationalizing, being resistance to change, and conformity are all ways that may hinder me to make the wrong judgments regarding Obama’s plans. The way I am going to overcome these habits are to get the facts and do my research. I am going to stay open-minded to the information I read and base my decision on the facts. After completing my research, I do not agree with Obama’s new plan for

China To Float Or Not To Float

2675 words - 11 pages foreign goods. The possibility of further changes in the exchange rate introduces a lot of uncertainty for Esquel. Hedging the foreign exchange risk on the forward market can reduce this uncertainty. Hedging was not possible in Esquel’s case since there was no fully convertible local currency. Also NDF was not an option as they were expensive to buy since companies often needed to pay a 5% premium even though the appreciation was only around 2

To Pray or Not to Pray

964 words - 4 pages School Prayer “To pray or not to pray?” This has become the question of many states that are unsure that prayer in school should be allowed or not. The problem with this is that the state should not be left to decide one’s relationship with God. Prayer as a whole for a nation is crucial if you are a person of faith. That is, if you believe in God, then you understand He is the creator of all things and to be faithful servants we must

To Eat or Not to Eat

1227 words - 5 pages To Eat or Not To Eat? Rachel Landry PSY/240 March 24, 2013 To Eat or Not To Eat Welcome to our group session today, I am Rachel Landry and I will be the counselor leading this group. My background is working with people who have issues with food, all different types of issues. During today’s group I will be addressing some of the facts and myths around what causes people to eat or not to eat. We will address some of the misconceptions

To Be or Not to Be?

1094 words - 5 pages Michelle Douglas Professor Carr English 1A 24 April 2010 To Be or Not to Be? Society has an interesting affect on how people act and portray themselves. Certain individuals feel the pressure of society and change who they are to fit it, possibly losing who they really are in the process. Others understand that even though society is constantly judging, it is important to remain true to one selves, only shape shifting when absolutely

To Drill or Not to Drill Oil

964 words - 4 pages To Drill or Not to Drill America’s dependency on foreign oil is a topic of much debate. As time goes on and the demand continues to increase, America needs to be proactive and look at ways to become more self-sufficient. According to the Energy Information Administration website 2008, America consumes about 19 million barrels a day of world oil, however, only the produces about 8.5 million barrels. This leaves

To Drill or Not to Drill?

595 words - 3 pages To Drill or Not To Drill? Frank Choumas HUM/114 January 20, 2011 William James Smith To Drill Or Not To Drill? At first this question seemed easy for me to answer. I am pro-Environment, so my natural reaction is to side on the,” no drilling side”, of the issue. After doing some research on oil and drilling, I find myself on the, less drilling side”. Through my research I found that oil has many uses besides energy. In doing this

To Prosecute Or Not To Prosecute

1038 words - 5 pages To Prosecute or Not To Prosecute As stated in the Code of Ethics for Nurses (1985), the nurse assumes responsibility and accountability for individual nursing judgments and actions. In other words, the nurse is ultimately responsible for all interventions and aspects of care that he/she gives the patient, whether it is knowledge-based and appropriate, negligent and improper, or even honest human mistakes that at times result in patient

To Organize or Not to Organize

2071 words - 9 pages Assessment of To Organize or Not to Organize Yolanda A. Wesley HRM534 Dr. Annette West January 26, 2016 An Assessment of To Organize or Not To Organize The discussion will pertain to “To Organize or Not To Organize” a union with the Foster Care Workers, who work for the City of Newport News Department of Human Services in Virginia. Within the discussion, safety regarding workers going on home visits alone and not in pairs; long

Related Papers

To Build Or Buy Essay

1713 words - 7 pages summary • Seller will provide three years of financial data • Seller agreed to provide proof of all monthly transactions inflow/outflow • Seller will also provide proof of taxes paid Conclusion My business strategy is to buy an existing business rather than start a new business. My new barber shop is a family friendly environment, where the whole family can get their haircut or hair done at a reasonable price, while not jeopardizing

To Rent Or Buy Essay

618 words - 3 pages price for the apartment and that’s it. Many people would think that living in an apartment is a waste of time and money. But that’s not true, buying a house is just as expensive as an apartment, if not worse. Renting an apartment, yes you pay a lot and at the end you don’t own it, but you never have to worry about the rent going up or any hidden fees like you do with a house

To Build Or Buy Bus 402

2114 words - 9 pages To Build or Buy Strayer University Course: BUS 402 January 29, 2012 My business strategy is to purchase an existing tea and coffee shop which is located a mile away from where I work in Ashburn, Virginia, the business is call Sakasa tea and coffee. Sakasa is located next door to George Washington University and directly across is a chick fil a and a small hotel also it is right off a major highway so it has a great location. The reason the

Buy Or Lease Essay

761 words - 4 pages Amy is trying to decide if she should buy a car or lease the same car. The car salesman has told her that she can buy the car for $27,000. She will need a down payment of $2,700. The remainder will be financed with a loan. It will cost her 4.5% compounded semi-annually. She will make 60 monthly payments at the end of each month. If she leases the car, Amy will not put any money down. However, she will be required to pay $12,500 at the end of the