Investigating the Factors that Affect the Price of a Second Hand Car
Introduction
I am going to test which factors affect the price of a second hand car
using a variety of different statistical techniques. From what I
discover using these techniques I will conclude which factors are the
most important.
I will examine only cars within the reach of a normal family, i.e. not
luxury cars. I will also exclude classic cars as these are unlikely to
perform like normal second hand cars.
Using a given set of data on the prices paid for second hand cars, I
chose ten of these factors and did a survey of the classÂ’ parents to
make initial assumptions of which factors they were most influenced by
when buying a second hand car. The survey asked them to choose the 3
most important and 3 least important from a list of ten. Using the
results of this data, shown on page Â… , I selected three hypotheses to
test. I will test these using a given data set. If I need to take more
samples to test the hypotheses more conclusively, I will obtain data
from other sources.
The types of information in the column represent the factors which can
easily be defined when buying a car, even though there may be other
ones that affect a person buying a car, even if they cannot be
measured. An example is their opinion of the person selling them the
car, as this will affect them a lot even though it is not possible to
use this with the data sample.
Hypothesis 1
The greater the original price of a car the greater its second hand
price will be.
I that there will be a link between these two factors because the
original price of the car will be a reflection of the attributes of
the car, so the second hand price should only change in price as a
result of what has happened to it since it was new (e.g. age, mileage,
To properly illustrate externalities that may shift the supply and demand curve in the U.S. auto market over the next five years, it is necessary to look at the recent events having affected the U.S. auto industry during the recession and the strides U.S. auto makers have made to recover from near devast...
The specific areas I studied, based on primary and secondary sources are Performance, Gas Mileage and Price of each automobile.
Purchasing a car is one of the biggest and most important decisions that someone will make during their lifetime. Over the past several years, the prices of a vehicle have increased significantly due to the rise of inflation. Economists compare averages of vehicles to calculate and determine the cost of every vehicle that ends up on the car lot. To determine the cost they interpret all the above information and include everything from the cost of making the vehicle to the time of selling it. In the long run, the demand for vehicles is inelastic because they become a necessity for many people. However, in the short run, the demand is elastic because the purchase of a new vehicle can be put off for a while.
motor vehicle. This requires them to hang around where they are and get a ride
In a capitalistic country with a free market, foreign competition is expected. This is no exception for the automobile industry where America competes with its various rivals. Competition from elsewhere encompasses that from Italy, Germany, and of course, the renowned Japan. The Japanese vehicle industry is especially competitive; according to the Automotive News Data Center, five out of the ten best selling vehicles of the year are Japanese vehicles. This data applies to the U.S. market over the first 9 months of the year. Expectedly, the automobile industry is an important and significant market. Motor vehicles are a major form of transportation as many people in the U.S. own at least one car.
Automobiles! You just have to have one in this fast paced world! In the United States automobiles are necessary. People need to move from point A to point B. These points can be as close as a few hundred feet or even range up to a few hundred miles! When making these trips safety is a priority. There are hundreds of thousands of automobiles on the roads across the nation and if safety was not considered, thousand would be injured or even killed daily! Automobile safety has come a long way over the years and as every day goes by more and more new ways are created to keep drivers, and their passengers, safe on the road.
The first thing to be mindful of when you are looking for a new or used car is the monetary value. New cars often cost more than used cars. There’s also a big difference in the value that each car has. A new car loses its value very quickly. The value of a used car on the other hand is constant for a couple of years. For example, my sister has a new 2008 Toyota Camry that cost about 13,000. The difference is clear in comparing the prices, although they came from the same company. When you are driving a new car, you need to avoid depreciation value. Unless you buy a classic or unusual car, the new car value would drop immediately you drive it out of the dealership lot. The value of the car decreases from 15 to 20 percent. For example, if you were to buy a new car for $20,0...
Second I will describe what these tests are used to figure out and how they are carried out.
When you hear the term “used car”, what is the first thing that comes to mind? Some may think of an old rusty Cadillac that belongs in a junkyard. Others may think of that nice Camaro at the used car dealership for sale. Over the years, used car sales have skyrocketed. In 2012, over 40.5 million used cars were purchased in the United States (Atiyeh, 2013). Used cars are in high demand in today’s economy because of the lower prices, slightly higher gas mileage, and that they can be more trustworthy against some of the newer models. With used car sales always climbing, how do buyers know what they are looking for in a vehicle? How do they come down to the final decision of where to purchase the vehicle? Most importantly, how can buyers make sure that they do not get scammed? This paper will take you through the process of purchasing a used vehicle, from deciding on a budget, all the way to the final purchase of your “new” car.
deal with “luxury” goods (Exhibit N). It is important to note that the sale of “luxury” goods is affected more
A vehicle is one of the biggest purchases a person will ever make. Over the years, the prices of an automobile have increased due to the rise of inflation. Due to a price index, the price of an automobile changes over a certain period of time. Economists compare averages of automobiles to calculate the cost of each vehicle that presents itself on a car lot. When all of the above is calculated within the purchase of an automobile, it affects every area of making the automobile to selling the automobile. All of these factors are impacted together for the automobile industry as a whole.
Intuitively, a cost-plus approach sets a lower boundary for the selling price. Yet to pitch a competitive price on the market, it takes more than that. The demand forecast advocates opting for the lowest selling price which yields the highest return. A market penetration strategy necessitates thorough knowledge of the selling prices of the nearest competitors and their retaliation potential. Ideally, the lowest price in the market of £10,400 dictates the upper ceiling of AUDI’s price discretion. However, setting initially a too low price in the hope for increasing it subsequently is not a viable option, as prices are somewhat inflexible upward. Instead, costs have to sink in the long run. Nevertheless, claiming a larger market share will allow AUDI to deftly climb the steep learning curve, lower its costs and further mobilize against market followers. A high price elasticity of demand insinuates that profit margins will continue to soar, if selling prices are reduced any further. As the point of maximum profit is apparently not yet reached, the company is advised to extend the range of the forecast. But is the highest profit naturally the best profit?
One method that Toyota can consider is using the price elasticity of demand to determine whether to increase or decrease the sale price of their automobiles. The responsiveness or sensitivity of consumers to a price change is measured by a product's price elasticity of demand (McConnell & Brue, 2004). Market goods can be described as elastic or inelastic goods as change in quantity demanded for that good. If demand is elastic, a decrease in price will increase total revenue. Even though a lower price would generate lower sales revenue per unit, more than enough additional units would be sold to offset lower price (McConnell & Brue, 2004). In a normal market condition, a price increase leads to a decreased demand, and a price decrease leads to increased demand. However, a change in income affecting demand is more complex.
Economic factors that affect Porsche Motors include interest rates, taxation changes, economic growth, inflation, and exchange rates. Porsche's market and financial successes are attributed in part to product quality, innovation, strategic partn...
Some fixed costs are depreciation, interest, insurance, & fees. Some variable costs are gasoline, tires, and maintenance on the vehicle. “The largest fixed expense associated with a new automobile is depreciation, the loss in the vehicle’s value due to time and use”(Kapoor, Dlabay & Hughes, 2012). An automobile purchases price might be cheap but when factoring in the fixed and variable cost the automobile could possibly cost more than expected. Websites like Intellichoice.com can help research and compare vehicle costs. This website shows the shopper how much it cost to own the vehicle for 5 years. When researching a vehicle to purchase it is important to consider these costs in order to make a good