Essay about A New House
August 14, 2011
Purchasing a home is one of the most vital choices one can make in their life. It is an exceptionally suitable area for the principles of economics to be taken into account to bring forth a good decision. This method calls for evaluation of marginal benefits and marginal costs. It also demands that one would consider their individual pros and cons attached to the decision. Personally, one would take their own family’s needs and welfare into thought during this course in their lives.
Five of the principles well suited to the guiding of a home purchase are: “People Face Trade-offs”. Most people have to make choices in their lives if they are going to …show more content…
The trade off that has to happen to make one decide to purchase a new house will be the advantage of the move need to be more important than the monetary costs of the purchase. Looking at a house that’s near the children’s schools and near local services. This will make the cost of gas lower and lower the time that one would spend in traveling every day. One would be able to enjoy their family longer everyday and rise ones quality of life.
The larger cost of a house on a monthly basis should be a smaller amount of these marginal cost advantages. One should also weigh the fact that additional funds they have to lay out monthly on a house will restrict their buying power for other goods throughout the life of the mortgage loan. In this situation, the marginal costs amount to the rent as opposed to mortgage as well as related costs. Rent is a continuing payment without lasting benefits. Mortgage is a continuing payment with a great lasting benefit. The marginal benefits are also recurring and include not only the financial advantages of decreased travel expenses, but in addition to the