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October 21, 2014

Homework Help: Hogan

Posted by Darlene on Sunday, January 16, 2011 at 12:29pm.

Please help identify the topic subject in each paragraph:

Interest rates affect our purchasing decision in a two different ways. A lower interest rate is obviously preferred to minimize expenditure being either long or short term. A lower interest rate is good when taking a loan, buying a house, car or evening taking out a credit card. Interest rates determine the amount a buyer can qualify for or if a buyer can qualify at all. Every time interest rates go up it eliminates thousand’s of buyers from the marketplace. Lower interest rate encourages more people to spend and or make more expensive purchases than they will with a high interest rate.

The issue about interest rate is like a "supply and demand”. The lower the interest the high the demand on market and the higher the interest go the lower the demand on the market. The negative thing about low interest rates is that it has the tendency to increase prices of items due to the high rate in demand. In viewing the prospectus of an investment return a higher interest rate is preferred to maximize your earning. So basically our decision either to buy or invest is based upon the interest rate at the market

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