...Supply and Demand Simulation ECO/365 Supply and Demand Simulation The supply and demand simulation included both microeconomics and macroeconomics concepts. The simulation focused on a property management firm, GoodLife Management, and its ability to adjust the levels of supply and demand of two-bedroom apartments in the Atlantis community. GoodLife Management was challenged with changes in population, tastes, income, and a price ceiling. As a result of these factors the firm had to strategize about shifts in the changes in supply and demand and determine the equilibrium price and quantity. The microeconomic principles from the simulation include the supply and demand of two-bedroom apartments and the affects of price. The simulation provided exercises on how to determine the number of apartments supplied, the population that demanded the apartments, and the appropriate price per unit at a given time considering market conditions. Microeconomics looks at the smaller picture and focuses on how individuals and firms make decisions based on economic forces. GoodLife Management had to consider how many apartments to supply and the price levels to charge for them to maximize profit (University of Phoenix, 2011, Week Two Simulation). Macroeconomics views the aggregate economy in terms of unemployment, growth, business cycles, and inflation. In the simulation, two macroeconomic concepts considered are the population growth in Atlantis and business cycles. GoodLife...
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...Supply and Demand Lisa Krezman ECO/365 October 21, 2013 Ramaling Iyer Supply and Demand Atlantis a small city with a distinguished atmosphere that has paternal for grow. A company Goodlife is looking at the effects of supply and demand on two- bedroom apartment rental. Goodlife is a property management company that manages seven apartment complexes with two-bedroom unit for rent in Atlantis. Currently, Goodlife who has monopolized the rental units in the Atlantis area is the only company who manges the rental unit within the area. Goodlife management is a monopoly in the apartment complex rental industry in Atlantis. Oakridge builders are a competitor trying to break up the monopoly that Goodlife occupies. Oakridge builders provided rental detached homes versus apartment complexes. As the regional manager for Goodlife the company has decided to lower the rental rates to meet the demand of possible tenants. Because of the reduction in rental price it caused a shift in the demand for rentals in a positive way. Goodlife reduced the rental rate by 15% however; there are still 300 vacancyies. At a rental rate of $1,050 per month this reduced the vacancy rate to a targeted level. At this rental rate, there were tenants for 1,700 apartments. This gives Goodlife revenue of $1.79 million. Even though there are vacancy’s Goodlife is still making money. When reducing prices to meet the demand of the consumer, the company will sell more. Reducing the price will cause a shift...
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...Demand, Supply and Prices in the Housing Industry F. Hill ECO/365 Principles of Microeconomics July 30, 2014 Mr. Keith Watts Abstract The slowdown in the housing market in the US has been accompanied by a sharp fall in house prices and a glut of homes for sale in the market. While the idea that this high number of dwellings for sale should place downward pressure on house prices is intuitive, little empirical work has been done in this area to assess the factors affecting house prices. This paper explicitly models the relationship between changes in prices of houses and various measures of housing demand and supply. A simulation model has been included to help explain the evolution of the housing market and enable one determine the equilibrium price, quantity and prices. The company under consideration is GoodLife management- a property management company that manages seven communities in the city of Atlantis. Keywords: Housing market, supply and demand, price elasticity and economics. Introduction From the demand and supply curve of the firm, various microeconomics and macroeconomics can be identified. Microeconomics looks at the behaviors of individual people and companies within an economy. It is based on the idea of a market economy, in which forces of demand and supply are behind prices and production levels of goods and services. Microeconomics is concerned with supply and demand in individual markets, individual consumer behavior and individual labor markets...
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...Supply and Demand Goodlife Management was the only firm in Atlantis that rented apartments. This gave Goodlife Management an advantage in the housing market. Detached rental homes owned by Oakridge Builders were the closest substitute to the apartment rentals. Without a substitute for rental housing in the Atlantis area, Goodlife Management maintained a monopoly in this market. Many factors cause changes to the supply and demand of a product or service. Companies need to make adjustments to pricing, supply, and demand to reach the equilibrium. Microeconomics With a vacancy rate of 28% Goodlife Management made the decision to lower the rental rates decreasing the vacancy rate down to 5%. The decision to lower the rental rates also enabled Goodlife Management to increase revenue. This product, two-bedroom apartments, demanded more quantity at a lower price and the supply quantity remained constant. This decision allowed the vacancy rate to decrease, revenue to increase, but still leaving a surplus of 100 apartments not rented. To rent the remaining apartments Goodlife Management would need to reduce the rental rate even more. Macroeconomics The increase in the population of Atlantis after new companies began developing businesses caused an increase in the demand for two-bedroom apartments. Lintech Inc, expanded its operations to Atlantis resulting in the population of Atlantis to increase. The demand has increased and the supply has stayed the same. The rental...
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...and streets. In Atlantis, the housing is either detached homes or apartments. GoodLife Management is a property management company that manages 7 buildings which consist of 2 bedroom apartments. GoodLife is the only company that rents out apartments, and this considered a monopoly (University of Phoenix, n.d.). In this paper, we will cover two concepts of Micro and Macro, what shifts the supply and demand curve, how it applies to a real-world product, and elasticity. In both micro and macro economics we learn about two concepts, which are supply and demand. Microeconomics which is the study of an individual choice and how the force in the economy has an effect on it and Macroeconomics studies the whole economy and all the factors. According to Colander (2010), “Supply is a schedule of quantities a seller is willing to sell per unit of time at various prices, other things constant. Demand is a schedule of quantities of a good that will be bought per unit of time at various prices, other things constant” (p. 983-984). GoodLife supplies 2-bedroom apartments on a temporary month-to-month lease which according to our survey team is what is in demand at the time. There are many reasons the demand shift moves one reason that has come up is change in preference. People who obtain better jobs with better pay might decide they can afford to buy instead rent. Where the supply curve only moved when GoodLife converted the 2-bedroom apartments into condominiums for sale. Thus, there are...
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...Petroleum Prices and Demand Abstract This week's simulation is centered on GoodLife Management. GoodLife Management is located in a town by the name of Atlantis, where the company rents two-bedroom apartments on a month-to-month basis. This paper will cover the simulation’s supply and demand for two bedroom apartments, the concepts of microeconomics and macroeconomics principles, the shifts in supply and demands, and how the equilibrium is affected during the shifts. The paper also covers how price elasticity of demand affects the decision-making of the consumer and the organization. Introduction The "Applying Supply and Demand Concepts" simulation displays how the supply and demand curves are affected by various conditions that happened with Goodlife's two-bedroom apartments in the city of Atlantis. The simulation called for choices to be made on the grounds for what was happening in the community of Atlantis and what the company was trying to accomplish economically as an effect of the changes within the community. This paper will recap concepts found in the simulations and explain what caused the changes in supply and demand, how the changes in supply and demand played a key part in the decisions that were made, and relate the concepts of supply and demand to reality. Microeconomics and Macroeconomics According to Colander (2010) “Macroeconomics is the study of the economy as a whole. It considers problems such as inflation, unemployment, business cycles, and...
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...process. Supply and demand is a large part of economics. This paper reviews the student simulation and how supply and demand affects the two-bedroom rental apartments in Atlantis as well as Goodlife Management properties. In addition, this paper will describe how supply and demand relates to both microeconomics and macroeconomics. Furthermore, this paper will explain how specific factors affect shifts in supply and demand on equilibrium price and quantily and how it affects a consumer’s purchasing and the firm’s pricing. Economics is separated into two sections: microeconomics and macroeconomics. Colander (2010) states, “Microeconomics is the study of individual choice, and how that choice is influenced by economic forces. Macroeconomics is the study of the economy as a whole. It considers the problems of inflation, unemployment, business cycles, and growth” (p. 15). There are microeconomic and macroeconomic principles and concepts addressed in the stimulation. Microeconomics A firm ability to adjust pricing affects revenue. To increase revenue and decrease occupancy Goodlife decreased the monthly rental rate from $1300 to $950 a month. In decreasing the monthly rental rate, the demand for the apartments increased causing a decrease in the vacancy rate. An increase in occupancy contribiuted to an increase in revenue.. In decreasing the price of the apartments, the firm increased revenue and occupancy. The decrease in price caused the downward shift in the demand curve. Another...
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...Microeconomics and the Law of Supply and Demand The Supply and Demand simulation concept is essential to understand the effects of pricing and availability to consumers on real world commodities. This simulation captures the impact of different scenarios and situation of the property management company, Goodlife Management in the city of Atlantis. In the scenarios and based on the situations that occurred, these factors influences the equilibrium such as adjusting the rental rate of the apartments to maximize revenue. An attempt to increase the price to ensure a sufficient number of apartments to be rented to satisfy the demands, and making modification to the firm's trend from rental apartments to homeownership in order to meet the needs of a growing population due to Lintech Inc (University of Phoenix, 2014). Macroeconomics VS. Microeconomics In the simulation, the concepts of both, study of Microeconomics and Macroeconomics, are examined. Macroeconomics focuses on factors that affect the economy as a whole (Colander, 2013). In the scenario where Lintech company was introduced, the changes led to the whole economy of the city of Atlantis, not just the financial situation of Goodlife Management firm. The firm perceived the increase of residential demands due to the company workers that relocated in the area. However, in the scenario, when the firm increased the rental price due to the foreseen increase of demand of more apartments need to be rented, Goodlife' s apartments became...
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...the Laws of Supply and Demand Name ECO 365/Microeconomics Date Professor Introduction The Supply and Demand simulation concept is essential to understand the effects of pricing and availability to consumers on real world commodities. This simulation captures the impact of different scenarios and situation of the property management firm, Goodlife Management in the city of Atlantis. Undergoing the scenarios, based on situations that occurred, these factors influences the equilibrium such as adjusting the rental rate of the apartments to maximize revenue, the attempt to increase the price to ensure sufficient number of apartments to be rented to satisfy the demands, and making modification to the firm’s trend from rental apartments to homeownership in order to meet the needs of the growing population due to Lintech Inc. Macroeconomics VS. Microeconomics In this simulation, the concepts of both study of Microeconomics and Macroeconomics are examined. Macroeconomics focuses on factors that affect the economy as a whole. In the scenario where Lintech company was introduced, the changes led to the whole economy of the city of Atlantis, not just the financial situation of Goodlife Management firm. The firm perceived the increase of residential demands due to the company workers that relocated in the area. However, in the scenario, when the firm increased the rental price due to the foreseen increased of demand of more apartments need to be rented, Goodlife’ s apartments...
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...Supply and Demand Simulation Thomas Alejandro ECO/365 February 17, 2014 Mubarak Laminu Supply and Demand Simulation The supply and demand simulation is based on the management of rental apartments by GoodLife Management in the fictional town of Atlantis. 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. At the beginning of the simulation GoodLife had 2,000 two-bedroom rental apartments and is required to decrease the monthly vacancy from 28% to at least 15% to increase revenue. GoodLife has to find what rental rate to input so all expenses are covered. There are many changes to the simulation that affect supply and demand. There are also shifts in the supply and demand that affect the decisions made by GoodLife. Four key points emphasized in the simulation are; supply and demand, equilibrium, shifts in the supply and demand, and price ceilings. The concepts in the simulation can be related to the workplace of the author of this paper. Factors that affect supply and demand in the simulation are driven by the number of available two-bedroom rental apartments, the demand for the rentals, the number of available renters, and the price. According to the simulation, a demand curve is downward sloping, and as the price decreases, demand increases. The supply curve is the opposite of the demand curve...
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...Supply and Demand Simulation The simulation focus was on the supply and demand aspects of rental units managed by GoodLife Management Company for duration of a nine year period within Atlantis. As a property management company, the duties include advertisement, receiving notices on upcoming vacancies, and establishing rental rates. Within the nine year period, there were many obstacles the management company faced which caused them to analyze the situation to make the best decisions. Some of the changes were increase in supply and demand, the curve in supply and demand, equilibrium, and price ceilings. The concept of microeconomics and macroeconomics used in the simulation are demand and supply, equilibrium, shifts in demand and supply, and price ceilings. Supply and demand are pivotal in understanding situations in businesses today. Supply as related to this simulation refers to the amount of rental apartments or condominiums GoodLife was able to lease or sale. Demand refers to the amount of properties leased or sold. The higher the price to rent properties, the lower the demand would be for those properties. As seen in one of the simulations, when there was a decrease in the monthly rent, it increased the demand. The simulation shift in the demand curve started after Atlantis surveyed the area and discovered that more people were interested in detached homes rather than two-bedroom apartments. This resulted in a decrease in demand but the supply remained the same....
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...Supply and Demand August 12, 2013 Eco/365 Chris Foster Introduction There were two microeconomics and two macroeconomics concepts in the simulation. Atlantis is a microeconomics apartment company which manage apartment complexes and homes in the city. Atlantis had one shift supply curve and one shift in the demand curve when business started moving into the city. These shifts affected the equilibrium price, quantity, and decision making with the demand needed to supply to consumers. I am applying what I have learned with supply and demand from the simulation to my management job with our rate increases. The concepts of microeconomics helps us understand the factors that affect shifts in supply and demand on the equilibrium price and quantity. The price elasticity of demand affects consumers purchasing and the firms pricing strategy with supply and demand. Microeconomics and Macroeconomics There were two microeconomics and macroeconomics concepts in the simulation. Atlantis is a rental company that manages the apartment and homes in the low populated city. The microeconomics concept in this simulation with Atlantis is the rental decision to maximize profit with decreasing vacancies. The property management company has consider the supply and demand of the apartments either by lowering the prices to increase rental occupancy or by raising the prices to maximize the cost of the rental inflation in the apartment complex. The macroeconomics...
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...Supply and Demand Simulation ECO/365 June 1, 2015 Supply and Demand Simulation Supply and Demand Simulation Supply and Demand is a model of economic price determination in a market and is most likely one of the concepts that is most fundamental of economics. They are the foundational of any marketing economy. “Prices are the tool by which the market coordinates individuals’ desires and limits how much people demand. When goods become scarce, the market reduces the quantity people demand; as their prices go up, people buy fewer goods,” according to Colander, D. (2010) As city that is maintained well and offers the residents everything, Atlantis provides sufficient parks, easily accessible highways, well serviced sidewalks and a low crime rate. A property management firm named GoodLife Management, is responsible for managing seven of the apartment within the Atlantis area and is subsequently, the only organization in the area that rents apartments. In order to determine the equilibrium within the market, it is imparitive to use the supply and demand cure because there have more than 2,000 apartments that are two-bedroom, with just a 28% vacancy rate. It is also important to understand and differentiate between movements along and shift of the demand and supply curves to determine how the equilibrium is re-established after the shift in curves. Some of the microeconomic principles present in the simulation include supply and demand. The simulation...
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...Microeconomics and the Laws of Supply and Demand Nicholas Perry ECO/365 May 26, 2014 Tarron Khemraj Microeconomics and the Laws of Supply and Demand In the Supply and Demand Concept Simulator, there were several microeconomic and macroeconomic principles covered. Also, there were shifts in the supply or demand curve throughout the simulator, and I will explain the shifts in greater detail. To understand what microeconomic principles were used in the simulator, understanding what microeconomics means is important. Microeconomics is the study or analysis of the economy or market on an individual or business level. It focuses on individual buyers and sellers within businesses. One example from the simulator of microeconomics is when Susan asked me to decrease the vacancy rate to 15 percent. In order to do this, I must decrease the cost of the apartments to try and increase the demand or interest in vacant apartments. The reason this is microeconomics is because the decision a decision made on an individual level and has to do with the buyer and seller only to benefit my business. Susan later asked me to lease out all 2,500 available two-bedroom apartments available. In order to do this, Hal suggest we raise the monthly rental cost for the two bedroom apartments so we can cover the maintenance cost. We have to do this in order to stay profitable. This is microeconomics because again, it is focused around the buyer (renters) and the seller (GoodLife Management). The decision to...
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...the laws of supply demand ECO/365 Supply and Demand Simulation Since the early years of commerce, supply and demand have been a huge factor in the capitalist business system. For this assignment I was asked to take part in a simulation as a source for my paper. In the simulation I had to take part of a series of important financial decisions for a fictitious apartment management company named GoodLife and see how each decision would be impacted by different economic factors. In this simulation, I was able to see that the microeconomics concepts could be labeled in the changes of supply and demand as well as the equilibrium in the apartment market. That is because the factors would only affect a small part of the apartment market in which the company on this scenario operates. The macroeconomics concept could be labeled with the price elasticity and the price ceiling. This is because it has a broad impact bigger than the local apartment market. The simulation taught me that any shift on the supply curve or demand can impact significantly the economics status of a company. For example, if the demand curve shifts to the left, it will show me that there is a decrease in the demand of people looking for apartments and in turn will cause that less apartments be rented. When this happens it forces GoodLife to reduce their prices to make up for the income gap. This means that the equilibrium price is lower because the demand decreased even though the supply (quantity of...
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