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Good morning, Attached is the Assignment, Requirements and Chapters for Week 1 of my Eco/561 class. There are 6 Chapters for this week, but the instructor only wants us to read a few sheets in each chapter and I included the pages within the Assignment and Requirements. Thank you
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Running head: Decision-Making in Purchasing a Personal Computer
Decision-Making in Purchasing a Personal Computer
Name
Institutional Affiliation
1
Decision-Making in Purchasing a Personal Computer
2
Decision-Making in Purchasing a Personal Computer
I have always wanted to purchase a PC of my own since I have always needed it for my
studies. I am a quality-oriented individual so I knew I wanted to go for a high quality PC. However,
for quite some time, this remained to be a mere desire putting into consideration I needed nothing
less than $800 to purchase the PC. Then it came a time when I received some money, around
$3000, to cater for several things here and there. I knew this was the right moment for me to go
for the PC that I’ve always desired. Contrary to my plans, I ended up purchasing the PC at a higher
price but also went home with a Home Theater System. Following this chronicle of events, there
are several factors that were huge determinants in my decision-making process of purchasing the
PC.
To begin with, before I bought the PC, I was never able to buy it there before because of
my limited income. Despite the fact that I got money that could was enough for me to buy a
computer, I could not go for it because my income was limited, and hence my budget could only
cover my basic needs. If I were to buy the computer there before, I would do it at the expense of
other important things like food, clothing and books.
Choice was another influential factor in my decisi0on-making process. When I went to the
electronics dealer, there I found several high quality PCs with varying prices. There were those
that sold for more than others. This was based on the fact that some had better specifications than
others. Though I really wanted to go for the PC set that had the best specification, I hand to make
a choice based on the amount of money I could safely part with for the purposes of purchasing the
PC. This led me to settle on a lower but fair quality PC which went for $1000.
3
Decision-Making in Purchasing a Personal Computer
Finally, the aspect of marginal benefit was relevant, seeing that after purposefully visiting
the electronics dealer, I went home with a computer and a home theater. An offer had been made
for a free home theater system for every purchase of a PC that was going for $1000. Keeping in
mind that I had an initial budget of $800 for the PC, I decided to increase it so that I could be
eligible for a free home theater system. If I would go for the $800 PC and later come to purchase
a home theater system, I would have to buy it for $400. With that in place, the marginal benefit
was greater than the marginal cost hence I went ahead and purchased the $1000 PC plus a free
home theater system.
Statistics of GDP and PCE for the last 10 years
GDP LINE GRAPH
6.0
4.0
2.0
-6.0
-8.0
-10.0
2016-10-01
2016-02-01
2015-06-01
2014-10-01
2014-02-01
2013-06-01
2012-10-01
2012-02-01
2011-06-01
2010-10-01
2010-02-01
2009-06-01
2008-10-01
2008-02-01
-4.0
2007-06-01
-2.0
2006-10-01
0.0
Series1
4
Decision-Making in Purchasing a Personal Computer
Over the years, the GDP has been inconsistent evidenced by the irregular troughs and crests as
illustrated by the line graph. This insistencies can be attributed to various variables in the country’s
productivity such as inflation and other factors.
PCE LINE GRAPH
14000.0
12000.0
10000.0
8000.0
6000.0
Series1
4000.0
2000.0
2016-09-01
2016-01-01
2015-05-01
2014-09-01
2014-01-01
2013-05-01
2012-09-01
2012-01-01
2011-05-01
2010-09-01
2010-01-01
2009-05-01
2008-09-01
2008-01-01
2007-05-01
0.0
The Real Personal Consumption Expenditure has been steadily increasing over the years as
indicated by the line graph. This means that each year, there have been positive income changes
for individuals enabling them to allocate more money for spending on their expenditures.
In terms of comparing GDP and PCE, there is no any evident correlation. This can be concluded
that these two are independent for one another, ruling away a causative relationship.
Statistics of FEDFUNDS and CPI for the last 10 years
FEDFUNDS LINE GRAPH
5
Decision-Making in Purchasing a Personal Computer
12.00
10.00
8.00
6.00
4.00
Series1
2.00
2016-06-01
2014-07-01
2012-08-01
2010-09-01
2008-10-01
2006-11-01
2004-12-01
2003-01-01
2001-02-01
1999-03-01
1997-04-01
1995-05-01
1993-06-01
1991-07-01
1989-08-01
1987-09-01
0.00
As evidenced by the line graph, the Federal Funds Rate has been on a generally decreasing form
with time. This means that the interest rates charged by different depository institutions to other
institutions have been steadily decreasing over the years.
CPI LINE GRAPH
300.000
250.000
200.000
150.000
Series1
100.000
50.000
2016-03-01
2014-04-01
2012-05-01
2010-06-01
200...