Question

Think of items that you have purchased in a market:
• Big ticket items like a house, or an apartment rental, or a car;
• Or ordinary items in your weekly budget, like coffee, tea, gasoline, bread, Milk, etc.

You can consider some of the following questions in your contribution.

What price trends have you noticed over the last few years? Do the prices fluctuate? Have prices increased or decreased?

How would you use what you have learned concerning Supply and Demand to explain these trends?

Have there ever been any shortages or surpluses? How would you explain that?

Answer 1

Buying a house.

The price trends over the few years have always been on a rise. With the growth in population and also the migration of people towards bigger opportunities of earning have led to an increase in the demand of the house properties. The higher demand gives rise to higher prices. The price of the property depends on many things such as the locality, the connecctivity, the clearance of title etc.There have been plenty of options in selecting what type of house to buy this comes from the supply side of the market which increases with the increase in the prices. There have been shortages due to excess demand over the supply in the real estate market.