Week 7 Assignment - much greater supply and fewer buyers...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Kayla J. Sutton 7/24/2011 Week 7 Assignment: Paragraphs and Topic Sentences Write two paragraphs about how interest rates affect out purchasing decisions. Identify the topic sentence in each by underlining it. Post your paper as an attachment. How interest rates affect our purchasing decisions. High interest rates create a disincentive to spend money. Because consumers know they will pay more money over the course of the loan, they may choose to postpone buying expensive items such as cars and homes. Often consumers choose to save their money in an interest-bearing account instead because they are receiving a higher return. Higher rates cause deflation, which means the purchasing power of the dollar is stronger. When interest rates are high, there is a
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: much greater supply and fewer buyers causing prices to drop of maintain. Low interest rates affect purchasing habits as well. When interest rates are low, it is more enticing for businesses and consumers to take out loans to finance large purchases. When consumers and businesses have easier access to credit, they spend more money. In most cases, low mortgage rates equate to more home purchases, and low credit card rates cause people to spend more on credit. However, low interest rates generally mean higher prices because there are more buyers and limited supply....
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern