Supply and Demand Simulation
Supply and Demand Simulation
Supply and Demand Simulation
During this simulation, many scenarios covered an understanding of demand and supply, equilibrium, shifts in demand and supply, and price ceiling that a monopoly had to face when different situations arose. I was able to understand the concept of microeconomics and macroeconomics with the scenarios the simulation provided. During the simulation with regards to microeconomics, GoodLife is what is considered as an individual choice and how that choice is influenced by economic forces. In one case, the choice was to lower the rental rate for two-bedroom apartments on temporary, month-to-month lease in order to increase revenue. GoodLife also determined a new monthly rate to ensure that more two-bedroom apartments were occupied and revenue was maximized, since according to the Atlantis Housing Survey, it provided statistics on the demand for more. As far as macroeconomics, GoodLife’s demand for rented two-bedroom apartments were reduced tremendously, and decided to convert some of its apartments into condominiums for sale. The reason behind the decision was an increase in incomes after the entry of Lintech led people to prefer detached homes rather than renting. A shift of demand occurred due to the change of preferences causing demand to decrease, therefore the demand curve shifted to the left. Goodlife’s decision for making more condominiums caused a decrease in supply, therefore the supply curve shifted to the left. The population grew in Atlantis and many people wanted to live in the city, however the prices were too high which then made the government, City Counsel, to impose a ceiling of $1500 on monthly rental rates for two-bedroom apartments. This made it possible for the middle-income families who wanted to work in the city could find affordable housing. The effect of the price ceiling in this scenario was the consumer’s quantity demanded exceeded producer’s quantity
Supply and Demand Simulation
During this simulation, many scenarios covered an understanding of demand and supply, equilibrium, shifts in demand and supply, and price ceiling that a monopoly had to face when different situations arose. I was able to understand the concept of microeconomics and macroeconomics with the scenarios the simulation provided. During the simulation with regards to microeconomics, GoodLife is what is considered as an individual choice and how that choice is influenced by economic forces. In one case, the choice was to lower the rental rate for two-bedroom apartments on temporary, month-to-month lease in order to increase revenue. GoodLife also determined a new monthly rate to ensure that more two-bedroom apartments were occupied and revenue was maximized, since according to the Atlantis Housing Survey, it provided statistics on the demand for more. As far as macroeconomics, GoodLife’s demand for rented two-bedroom apartments were reduced tremendously, and decided to convert some of its apartments into condominiums for sale. The reason behind the decision was an increase in incomes after the entry of Lintech led people to prefer detached homes rather than renting. A shift of demand occurred due to the change of preferences causing demand to decrease, therefore the demand curve shifted to the left. Goodlife’s decision for making more condominiums caused a decrease in supply, therefore the supply curve shifted to the left. The population grew in Atlantis and many people wanted to live in the city, however the prices were too high which then made the government, City Counsel, to impose a ceiling of $1500 on monthly rental rates for two-bedroom apartments. This made it possible for the middle-income families who wanted to work in the city could find affordable housing. The effect of the price ceiling in this scenario was the consumer’s quantity demanded exceeded producer’s quantity