StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Illustration of the Microeconomics Concept - Essay Example

Cite this document
Summary
The essay "Illustration of the Microeconomics Concept" focuses on the critical analysis of the major issues in the illustration of the microeconomics concept. The article Supply vs. Demand: Why Is Housing Hurting? of October 18, 2011, was posted on the Wall Street Journal…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER93.6% of users find it useful
Illustration of the Microeconomics Concept
Read Text Preview

Extract of sample "Illustration of the Microeconomics Concept"

In the article, ‘Supply vs. Demand: Why Is Housing Hurting?’ of October 18, 2011, posted in the Wall Street Journal, the author, Mr Nick Timiraos, questions the forces bringing about the supply-demand imbalance and confusion. The author starts by exclaiming, “Is poor supply or low demand the biggest cause for concern in the contemporary housing market?” In answering the question, he points out that a part of the problem is due to the lack of enough buyers for homes in the US. This, he notes, is evident from the extremely low mortgage rates being offered. He also traces the confusion to the non-availability of attractive homes in many parts of the country, a case that is making the available buyers lack the houses they could want for purchase.

This view was however challenged, by chief Economist Paul Dales, arguing that, since 30 years back, there has been an excess supply of one million homes, available to be traded. He further cites the poor economic situation, as the cause for the decreased level of home purchases in the past. The author cites another problem, which could be hampering the supply-demand stability of the home market, as the acutely decreasing home prices. From the different accounts, the debate ends with no clear definition of the problem facing the home market in the US (Timiraos, 1). However, the author integrates the different versions of the explanations, into the causes for the confusion facing the US homes market. These include the availability of many homes at the wrong places, where customers are not willing to buy, which is the result of the housing boom; the overpricing of the many homes available for sale – an effect of the declining inventory; and the short sale cases, which make up the bigger part of the market.

The economic concepts illustrated through the information include the concept of demand, where the shifts in the demand curve are depicted through the changing preferences of buyers, where the case is that, despite the availability of about a million homes for sale, the buyers cannot find the homes they want to purchase. In the area of buyer expectations, buyers are not willing to buy homes, which are located in far-flung locales. The concept of demand is depicted through the case of the inflated home prices, of the homes that are available for sale, as a result of the declining inventory. This case is thus, leading to decreasing demand, in response to the increased prices. The concept of demand is also indicated through the findings, as the inability of Americans in the area of purchasing homes, according to Economist Paul's accounts. According to him, this directly leads to an imbalance and a failure to establish the equilibrium, as the sellers are offering a price, but the buyers are unable to offer a bargain price, so that equilibrium can be established. The concept of market changes is depicted by the housing boom, which was in response to an increase in the demand for homes, which has been affected by the shift in the demand for homes at the undesired locales. The cost of production is another concept reflected in the article, as sellers are overpricing their homes, in an attempt to avoid the sale of the homes, at prices less than the mortgage debt owed, which the banks may offer (Timiraos, 1).

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Micro-Economics Essay Example | Topics and Well Written Essays - 250 words”, n.d.)
Micro-Economics Essay Example | Topics and Well Written Essays - 250 words. Retrieved from https://studentshare.org/macro-microeconomics/1592390-micro-economics
(Micro-Economics Essay Example | Topics and Well Written Essays - 250 Words)
Micro-Economics Essay Example | Topics and Well Written Essays - 250 Words. https://studentshare.org/macro-microeconomics/1592390-micro-economics.
“Micro-Economics Essay Example | Topics and Well Written Essays - 250 Words”, n.d. https://studentshare.org/macro-microeconomics/1592390-micro-economics.
  • Cited: 0 times

CHECK THESE SAMPLES OF Illustration of the Microeconomics Concept

Introduction to Microeconomics

This paper talks about the main concepts of the microeconomics.... The focus of the microeconomics is on interactions between buyers and sellers and the factors that influence their decisions.... Every concept was studies from the best possible source including books and electronic sources.... Furthermore authorized academic websites were consulted for various concept analysis and diagrams for concept illustrations....
4 Pages (1000 words) Essay

Analysis of news article in relation to macroeconomic concepts

Analysis of News Article in Relation to Macroeconomic Concepts Name: Institution: ANALYSIS OF NEWS ARTICLE IN RELATION TO MACROECONOMIC CONCEPTS Introduction Universities, as well as other institutions of higher learning, are vital to economic growth.... They have an essential role in the Canadian society and economy, innovation and research, as well as growing of future talent....
4 Pages (1000 words) Term Paper

Economic Efficiency Concepts

n view of these, a relevant topic encompassing economics at the abovementioned level is the concept of economic efficiency.... In examining economic efficiency, there are three categories that need to be presented to give a clearer view of this concept: productive efficiency, allocative efficiency and distributive efficiency. ... This criterion is relevant to the concept of economic efficiency in terms of determining how value is maximized.... llustrative concept of Economic Efficiency ...
4 Pages (1000 words) Term Paper

Supply and Demand/Microeconomics

Economics has perhaps been the most widely studied discipline and has consequently been divided into two definite scope areas, namely microeconomics as well as macroeconomics.... microeconomics is the smaller scope of economics that deals with specific focus on decision making factors that entities consider at the individual or firm levels....
4 Pages (1000 words) Essay

The Concerns of Economics

n illustration of the Production Possibilities model, including a summary of what the model is illustrating and the economic implications for the economyFigure 2Retrieved from http://www.... microeconomics gives an insight in supply and demand and various forces that may influence the prices in the market....
2 Pages (500 words) Assignment

The Peculiarities of Microeconomics

Elasticity is another microeconomic concept.... This assignment describes the main peculiarities of microeconomics.... This paper analyses term microeconomics, monopoly, Elasticity, utility, and works cited.... Moreover, microeconomics analyzes the relationship between supply and demand with the prices.... In other words, microeconomics mainly deals with the behaviors of the buyers and sellers and the factors which affect both buyers and sellers....
8 Pages (2000 words) Assignment

Difference between Microeconomics and Macroeconomics

Macroeconomics just like microeconomics is an important concept in economics because it has various important concepts that are essential for economic wellbeing of any country.... One cannot understand why decisions are made without understanding the concept of opportunity cost and hence, opportunity cost is undeniably vital and essential in the field of microeconomics.... This concept was further built-on and modified by other economists such as William Stanley....
12 Pages (3000 words) Coursework

Opportunity cost and Production Possibility Frontier

production possibility curve is a theoretical illustration of the amount of two varying commodities that can be achieved through shifting resources from producing one to producing the other.... It is an aspect that is utilized broadly in microeconomics when assessing the manner in which a complicated system is impacted by marginal manipulation of variables (Mankiw& Taylor, 2006).... ?microeconomics....
6 Pages (1500 words) Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us