Essay on Buying a New Car

790 Words Jun 25th, 2012 4 Pages
Buying a New Car
XECO/212 Principles of Economics
April 1, 2012

Buying a new car is fun and exciting but there are many factors in today’s market that are affecting those who want to purchase a new car. Not only are fuel prices incredibly high and expected to go higher based on tensions in the Middle East, employment is looking up but many are still without jobs or enough income to purchase a new vehicle. There are a few car makers that understand those looking for an economic vehicle that gets great gas mileage. Some of the factors that could cause possible changes in the supply and demand of a new car are again unemployment. This affects demand more than anything. If you do not have income to pay for a new vehicle the
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If still in the market for an SUV the most fuel efficient SUV of 2012 is the Ford Escape Hybrid which offers a 32 MPG combined and a decent price. You would however be giving up luxury for fuel efficient affordability. Well already I have talked about one complement for a new car that also affects the supply and demand for what new car you buy. Gasoline, you wouldn’t buy a new car without also having to buy gas. Gas right now is reaching all time highs and expected to go higher so again people are looking for more fuel efficient vehicles since driving or not driving for many is not an option. Those that live in rural areas have no choice but to drive to get to work and shopping. Another complementary item for a car is new tires. You know at some point it will be necessary to replace the tires on your vehicle. Insurance is another complementary item to vehicles in general but many states now have laws that mandate proof of insurance when purchasing a new car. Many times due to increased safety features on newer vehicles people will sometimes find their insurance rates drop when purchasing a new car with additional safety features. The price elasticity of demand, measures the responsiveness of quantity demanded to a price change. Since fuel prices are already up and

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