Supply and Demand Simulation - 1060 Words

Supply and Demand Simulation ï ¿ ½ PAGE * MERGEFORMAT ï ¿ ½1ï ¿ ½ Supply and Demand Simulation University of Phoenix ECO/365: Principles of Microeconomics October 26, 2009 ï ¿ ½ Supply and Demand Simulation IN THE UNIVERSITY OF PHOENIX SIMULATION (2003), APPLYING SUPPLY AND DEMAND CONCEPTS, A SITUATION IS PRESENTED CONCERNING THE SUPPLY AND DEMAND OF TWO-BEDROOM RENTAL APARTMENTS IN ATLANTIS. THROUGHOUT THE SIMULATION SCENARIOS ARE PRESENTED AND CHOICES MUST BE MADE REGARDING FACTORS THAT AFFECT DEMAND AND SUPPLY, AND THEREFORE, EQUILIBRIUM (UNIVERSITY OF PHOENIX, 2003, PARA. 5). CAUSE OF CHANGES The changes in supply and demand in the simulation are caused by different factors throughout the simulation. The causes included changes in vacancy†¦show more content†¦Summary of Results _Scenario One_ In the first scenario the monthly rental rate needed to be determined to reduce the vacancy rate to about 15%, while maximizing profits. The change in the demand was due to the rental rate; lowering the rental rate to $950 increased the quantity demanded to 1900 with a surplus of 100, and maximized profits to $1.81 million. _Scenario Two_ In the second scenario, the goal was to reduce the vacancy rate to zero percent. The possibility of leasing out all 2,500 apartments at the current rate of $1,100 meant that the business would not be profitable due to the increase in maintenance costs. Increasing the rental rate to $1,550 covered the maintenance costs and increased the number of apartments GoodLife was willing to supply. _Scenario Three_ In the third scenario, the Atlantis Housing Survey provided statistics regarding the demand for two-bedroom rental apartments in Atlantis. The survey found an imbalance in the quantity demanded and quantity supplied at the current rental rate of $1,550. Lowering the rental rate to $1,050 removed the imbalance and created equilibrium in the market. _Scenario Four_ In the fourth scenario, Lintech Inc. relocated to Atlantis and increased the population in the city. The demand for apartments increased, while the supply of apartments did not change causing a shift in demand to the right causing a shortage. Increasing the rentalShow MoreRelatedSupply and Demand Simulation1030 Words   |  5 PagesSupply and Demand Simulation ECO/365 Supply and Demand Simulation In the supply and demand simulation a neighborhood called Atlantis is given for the setting. Atlantis is a small city with open spaces, low population, and a low crime rate. There are plenty of sidewalks and street systems for easy access to the highway. The housing in Atlantis is detached homes and apartments. The supply and demand simulation consists of microeconomics and macroeconomics. The simulation presents shifts in theRead MoreSupply and Demand Simulation1203 Words   |  5 PagesSupply and Demand Simulation Summary University of Phoenix ECO360, Economics for Business I The Supply/Demand simulation involves acting as property manager for GoodLife Management in the fictional town of Atlantis. GoodLife Management manages seven apartment complexes in Atlantis. The property manager is expected to adjust the monthly rental rate of two-bed rental apartments and the quantity of apartments supplied based on the market trends. 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This simulation was an exercise in applying the supply and demand concepts based on current market trends. The property manager is required to adjust the monthly rental rate of two-bedroom rental apartments and number of apartments available. Supply and demand within the simulation were manipulated by the rates chargedRead MoreSupply And Demand Simulation Analysis1189 Words   |  5 PagesSupply and Demand Simulation The economy is a practice that relies on principles and concepts. The different focuses are based on a Macro and Micro perspective that creates the commercial and consumer environment. It is important to understand how these principles and concepts relate to the environment to create strategies that will, in return create profit and confident investments. The supply and demand simulation highlighted the important of just that from a commercial setting. Today’s housingRead MoreSupply and Demand Simulation Paper886 Words   |  4 PagesSupply and Demand Simulation Paper ECO/365 Week 2 Individual Assignment February 25, 2013 Supply and Demand The analysis will identify two microeconomics and two macroeconomics principles or concepts from the simulation, and explain why each principle or concept is in the category of macroeconomics or microeconomics. The analysis will identify at least one shift of the supply curve, and one shift of the demand curve from the simulation and what causes the shifts. The analysis will showRead MoreSupply and Demand Simulation Essay1024 Words   |  5 PagesSupply and Demand Simulation Supply and demand plays an intricate role in the amount, price, and availability of products and services. The applying supply and demand concepts simulation guides users through making decisions for Goodlife, a management company for 2 bedroom apartments in Atlantis. The simulation names the user the property manager; responsible for vacation residents, new pricing for units, and advertising. The property manager makes decisions in circumstances including the changing