Supply And Demand
Supply and demand is evident all over the US and beyond. Dependent upon where you want to live depends on how much you will spend to live in a highly populated area. “Demand is defined for a particular period”, (O’Sullivan, Sheffrin & Perez, 2008 p. 68). So as long as the demand for the product or housing in this particular case is clear then the higher the cost for the product will be. Supply on the other hand is “the amount of the product that the firms are willing and able to sell”, (O’Sullivan, Sheffrin & Perez, 2008 p. 71). So as long as the consumers are buying their products then the companies can continue to sell.
House buying varies from state to state. If someone were to move to San Francisco from Virginia Beach the demands of home buying is certainly higher. According to www.bestplaces.net, I would have to increase my salary from $60k to $104k just maintain the same living comforts from where I was living. Also it is 72 percent more expensive to live in San Francisco then to stay in Virginia Beach because the housing is the biggest factor of the living difference. The housing alone is 144 percent more expensive to live in San Francisco. For me to move from Virginia Beach back to my hometown in a very small place in Alabama, Tallassee that is, would be approximately 24 percent cheaper to move back home. Housing is about 56 percent cheaper. And I my $60k salary could decrease to $45k to maintain my living comforts.
The cost of living will vary between state to state because of the demand of the people who live there. The demands of the state could range anywhere from gas to state income taxes and highways, law enforcement. It could also just be a desirable place to want to live. Maybe there is a popular landmark or Hollywood. Virginia is popular because of the military and all the trains and trucks that pass through. It is also open to the Atlantic Ocean for trade so that plays a huge part in its cost of living.
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