XECO 212 Week 1

Week 1

CheckPoint: 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.

Consider the 10 Principles of Economics as outlined in Ch. 1 of the text.

Assume for this CheckPoint that purchasing a new home is a major decision requiring a substantial financial outlay where the wrong decision has long-term financial consequences.

Submit a 250- to 300-word response addressing the following points:

Which of the 10 principles do you think plays a major role in your decision?

Provide an example for each about decision-making, interaction, and the workings of the economy.

Explain how that influences the marginal benefits and marginal costs associated with the decision to purchase a house.

Locate recent articles in the New York Times or Wall Street Journal in which economists are quoted using positive and normative statements. Provide one quote and its context for both a positive and normative statement. Explain your choice. Evaluate the statement choices of your fellow students.

Select a good that you are familiar with. What are the factors that shift the demand curve for this good? What are the factors that shift the supply curve for this good? How do you expect the supply and demand of your selected good to change in the next year? Relate your expectation to price and quantity.