Market Equilibrating Process
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Market Equilibrating Process
University of Phoenix
ECO/561
Frank Kingsland
September 7, 2010
Market Equilibrating Process
Are Sandra and me in the market for a Lexus? Sandra is my wife. After four years or 48 months, the lease expired on August 15, 2010 on the vehicle that Sandra primarily drives. One would think that with the lease expiring that would put our family in the market for another vehicle. This paper will relate key concepts in this week’s readings to our prior real-world experience. Additionally the paper will include a discussion on the market equilibrating process.
This first paragraph will briefly identify the key concepts that will be discussed. Specifically, what are markets, demand, and supply and how each affects market equilibrium? These are all key concepts discussed and learned during the first week of our student reading. According to McConnell, Brue, and Flynn, markets bring together people who want to consume a product or resource and those that want to buy a product or resource (2009). In the case of Sandra and me, we are the consumers or demanders. We were looking to return our 2006 leased Lexus GX470 SUV and to possible lease or buy another vehicle. The seller in our situation is Pohanka Lexus, a car dealership located in Chantilly, VA. Demand is an interesting concept. As noted by McConnell, Brue, and Flynn, “demand is a schedule or a curve that shows the various amounts of a product that consumers are willing and able to purchase at each of a series of possible prices during a specified period of time” (2009). McConnell, Brue, and Flynn also explain that the law of demand, other things equal, is that as price falls, the quantity demand increases and the inverse or negative relationship occurs as price increases, the quantity demanded decreases (2009). What was interesting to observe after this week’s learning was how supply and demand together determine market equilibrium.
To examine this affect I will...
University of Phoenix
ECO/561
Frank Kingsland
September 7, 2010
Market Equilibrating Process
Are Sandra and me in the market for a Lexus? Sandra is my wife. After four years or 48 months, the lease expired on August 15, 2010 on the vehicle that Sandra primarily drives. One would think that with the lease expiring that would put our family in the market for another vehicle. This paper will relate key concepts in this week’s readings to our prior real-world experience. Additionally the paper will include a discussion on the market equilibrating process.
This first paragraph will briefly identify the key concepts that will be discussed. Specifically, what are markets, demand, and supply and how each affects market equilibrium? These are all key concepts discussed and learned during the first week of our student reading. According to McConnell, Brue, and Flynn, markets bring together people who want to consume a product or resource and those that want to buy a product or resource (2009). In the case of Sandra and me, we are the consumers or demanders. We were looking to return our 2006 leased Lexus GX470 SUV and to possible lease or buy another vehicle. The seller in our situation is Pohanka Lexus, a car dealership located in Chantilly, VA. Demand is an interesting concept. As noted by McConnell, Brue, and Flynn, “demand is a schedule or a curve that shows the various amounts of a product that consumers are willing and able to purchase at each of a series of possible prices during a specified period of time” (2009). McConnell, Brue, and Flynn also explain that the law of demand, other things equal, is that as price falls, the quantity demand increases and the inverse or negative relationship occurs as price increases, the quantity demanded decreases (2009). What was interesting to observe after this week’s learning was how supply and demand together determine market equilibrium.
To examine this affect I will...