Supply_and_Demand

Supply and Demand 1 The product that I chose is a new car. I purchased a new car last year while the cash for clunkers program was going on. I had a few different cars that I was trying to choose between and a baby on the way that I had to consider. A lot of different things went into my decision but in the end I was very pleased with my decision. Since I bought my car during the cash for clunkers program a lot of other people were in search of a new car also so the supply of cars was lower than usual because of the demand for them. A lot of people were taking advantage of this program so the demand was very high while the supply kept getting lower and lower. It seemed like every time the dealers would get new cars than they would run out again and only have a few left. The factors that affected the change in the supply and demand in this situation were the incentive of the cash for clunkers program. People who didn’t really intend to buy a new vehicle were suddenly faced with the incentive to get rid of their old vehicle and get a price cut on a new vehicle. The program was the reason that I decided to get rid of my old truck and get a good car. Two products that may be substitute for my product would be a used vehicle or using public transportation. Instead of buying a new car it might be better to buy a used car especially if it can be paid for out right because it is one less bill to worry about every month. The demand for good quality used cars is very high and the supply is kind of low where I live at. Most people where I live would rather buy a good used car that isn’t but a few years old because it is cheaper than buying a brand new vehicle. Supply and Demand 3 This makes the supply slim and it takes a little bit of searching in order to find the vehicle that you are looking for because you have to be careful about what you buy. The only other substitution for a new vehicle that I could think of was to use public transportation instead of buying a new car. Taking advantage of public transportation saves in a car payment, insurance, and maintenance but has its downfalls. If you live out of town than there is no public transportation to take advantage of.