Eco 372 Week 2 Product Purchases & the Economy

Is that over a 36 month period diesel vehicle resale value is 10 percent higher. (ALG) Another point from an environmental standpoint is that diesel vehicles can use biodiesel to help cut back the need of fossil fuels. Finally one last point to mention is the energy density of diesel over gasoline. According to a study by Dr. James J. Eberhardt from the U.S. Department of Energy, “diesel has a 12.8 percent higher energy rating”, so what this means to the consumer is it will take you less amount of fuel to get from one place to another, or you will create 12.8 percent more power per gallon which will give you better miles per gallon. Most diesel vehicles cost more to purchase, but with the 30 percent better fuel economy over time you will be saving more money than what it actually cost you to purchase the car in the first place. This also takes into consideration the fact that diesel fuel costs more per gallon than

People usually purchase cars for different reasons. Most people choose their cars according to necessity. In spite of all the world campaigns to raise awareness about air pollution an global warming people still prefer to have their own vehicle to be able to move around more comfortably.

The law of supply and demand states that when there is high demand for a good or service, the price of the good or service rises. If there is a large supply of a good or service but not enough demand for the good or service, the price falls. Each transaction involves a buyer and a seller. The seller places an offer for an item and the buyer may accept or reject the offer. When there is a high demand for certain good in a particular city or country and a lack of supply for a quality good, the prices tend to rise as well. Also, when there is no demand for a certain good due to a weak economy and an

When purchasing a car it is advisable to consider the economic hardships. New cars are expensive and may not be viable during recession. Old cars on the other hand are cheaper but their interest rates on the loan are high. Your income levels will determine which car to purchase. Old cars are subject to breakdown and recurring repair and maintenance costs.

The market pressure that occurs when the quantity demanded exceeds the quantity supplied could result in a shortage (MaEachern, 2015, p. 62). Furthermore, the consumers will compete to purchase the product, even though it is in short supply (McEachern, 2015, p. 62). Also, the purchaser’s competition to buy the merchandise forces the price to go even higher due to the demand (McEachern, 2015, p. 62).

Why do some cars depreciate faster than others? Why do some cars hold their value, while some don’t? These are a couple questions that will be answered in this paper.

SUV and Crossover vehicles are starting to take over the US car market. 2016 is the year of the SUV and pickup truck. Each month the car sales share of the market slips a bit (NPR, 2016). This means that sales of your average car are starting to slip. If you pay attention while driving down the road you may notice this. I believe there are several reasons why this is starting to be the case. SUVs and Crossover vehicles sit higher than an average commuter or luxury car. They tend to have more space inside for passengers and cargo. They are starting to rival the fuel economy of cars. Four wheel drive is a feature available to all of them.

The US Auto industry is facing the reality that new generations are not the same generations on which they built their empires. As information and global awareness are more prevalent than ever before, the consumer only wants to do what feels right to them, not what they have been told to want, and statistic show that the things the new consumer is looking for above all, is the lower cost of owning a car, followed fuel efficiency and how environmentally friendly it is.

There has been a rise in the unemployment rate from 5% in 2008 to 8.2% in 2012. This shows that the economy of the country is not healthy (Heertje & Perlman, 2010). As it implies that industries are either unwilling to employ, or the power of the economy to absorb the existing workforce is low. The inflation rate has been declining over the past five years. The decline in inflation and increase, in unemployment, suggest that poor performance in an economy (Heertje & Perlman, 2010). Comparing with five years ago there is a high expansion of capital market in the united state than the general economic growth.

Today, the modern global automotive industry encompasses the principal manufacturers, General Motors, Ford, Toyota, Honda, Volkswagen, and Daimler Chrylser, all of which operate in a global competitive marketplace. The Automotive Industry. Global competition resulted in less market share for U.S. car manufacturers and threatened company profits as more foreign brands entered the U.S. market. The total market share of General Motors fell from 28.2% in 2000 to 17.6% by 2014. Ford fell from 24.1% to 14.7%. Chrysler now holds only 12.7% after having 15.7% of the market in 2000. High labor costs, product lines that emphasized large vehicles with significant gasoline use and a looming global recession caused a crash in U.S. automaker profitability in 2008. American car manufacturers were struggling to compete against better, more efficiently manufactured products from overseas companies. As of 2015, Toyota earns more than GM, Ford and Chevrolet combined.

During the last decade, more investors have been jumping on the classic-car bandwagon, buying antiques and otherwise prized automobiles. The demand has helped push the value of classic cars up nearly 500 percent in the decade ending in 2015, according to the Knight Franklin Luxury Investment index.

Despite recent growth, the U.S. motor-vehicle sector is still behind. Total U.S. motor-vehicle sector sales in 2011 were 48.1 percent below sales in 2000 because of declining overall demand and significant long-term loss of market share.

The countrywide automotive industry in USA are changing the expense of recyclables upwards almost 50 % and the declining US dollar are growing pressures During U.S. exports have become appealing, other lands are waging a cash war to stop their moneys from dropping. Another factor influencing national automakers is the expanding demand for high tech equipment -fostering increase in exports and creation by 10% to 30%. The interest rates, money, increase (less than 2%) and rising prices, which stay low, are inhibiting a more talented restoration. Exacerbating this slow growth is deleveraging, where buyers fall a 9 % unemployment cost; their debt; and uncertainty over the futurity of authority policies such as for instance the Bush administration's tax cuts and the Obama business's healthcare bill and increase private savings.

Among the contributing factors to this trend is the fact that cars are being produced in large numbers and in many varieties. Due to a large supply of cheap vehicles, more and more people can now afford to purchase cars (Researcher, 2009, p. 384).

Buying a car is one of the most important decisions we make at a youthful age. The little knowledge that us masses of people fear when it comes to cars, can lead to wrong decisions that can affect us not only economically, but also at the level of security. Therefore, it is important to inform ourselves before buying a car. We should interpret the pros and cons and exactly understand our needs and which is our budget. After several searches and the consideration of some factors, there are two cars I am willing to consider purchasing and they are the Honda Civic LX Coupe, 2017 with a MSRP of $20,415 and the Hyundai Sonata Sedan, 2017 with a MSRP of $22,435.