Supply And Demand Concepts : Critical And Macroeconomics And Microeconomics Settings

The Supply and Demand simulation was reviewed on the student website demonstrated the concepts of the concepts of microeconomics and macroeconomics. The principles of microeconomics and macroeconomics were explained and applied throughout the simulation demonstrate the rationale for the shifts in the supply and demand curve. Each shift is analyzed showing the effects of the equilibrium price, quantity, and decision making process for the simulated company represented. The concepts encountered in the simulation provide an opportunity to better understand how each can be applied to my current workplace. The Scenario provides an

The Supply and Demand Simulation consist of microeconomics and macroeconomics concepts. The concepts are explained and how they apply to the principle of microeconomics and macroeconomics. The simulations presents shifts in the supply and demand curve, the rationale for the shift is given. Each shift is analyzed showing the effects of the equilibrium price, quantity, and decision making for the company presented. An explanation of the price elasticity affects the pricing strategy for consumers and company.

Goodlife Management experienced an increase in the demand curve of rental apartments due to the decrease in the rental rate. This shift in the demand curve would cause the equilibrium price to slightly increase because the demand curve would shift to the right and the supply curve would stay the same causing the price to fall higher upon that demand curve. The quantity of the apartments available would stay the same and ultimately would encourage the property manager to follow through with the decision to decrease the rental price. A great example of a shift in the supply curve occurred when the property manager was asked to rent all of the 2500 apartments available in order to obtain zero percent occupancy. With the increase of the monthly rental price, Goodlife Management shall have more incentive to lease more apartments to tenants. This shift in the supply curve would drive the equilibrium price in a more positive direction to further encourage the rental of more apartments. The quantity of apartments would obviously increase caused by the increase in the supply available for rent. Such a decision to rent additional apartments at a higher price would more than likely be a definite alternative as revenue shall increase as the vacancy rate gets closer to zero percent. Ebara Technologies, Inc. (ETI) is a nationwide corporation who manufactures vacuum pumps in which one of the corporate offices resides

Demand can either decrease or increase based on price of a product or service. Consumers have a tendency to buy products when there is a decrease in price. Companies have to kick off discounts to the consumers to increase demand. Pricing strategies for consumers are to buy when prices are low, although companies have to change prices to increase and decrease demand when needed. The simulation showed the same effect from the property management company. When supply was low of apartments the company had to increase price to decrease demand. When supply was too high the company had to decrease price to increase demand. The price elasticity of demand is flexible in which it can be changed and in return have an immediate effect. However, this can be harmful for

Michigan has an abundant supply of fresh water. However, an economist would consider it a scarce resource because

(Key Question) Cite three examples of recent decisions that you made in which you, at least implicitly, weighed marginal costs and marginal benefits.

For example, if the demand curve shifted to the left, it would decrease demand. The results would show fewer prospects for renting an apartment. The business would take a hit due to the decline in applicants looking to rent an apartment and in return will have to decrease prices to compensate for the demand and reset an equilibrium. The equilibrium price would ultimately drop to support the decreased demand, while supply stayed constant. If the supply curve shifted to the right, the visual will show an increase in apartments for rent. The two scenarios will show supply increase, one because demand decrease or an influx in supply creating more apartments for rent. The simulation shows that corporations need to be flexible and adjust to the economic environment. If they understand the problem, a successful solution can be created. One suggestions for the company should be a price decrease to adjust to the economic value, creating an affordable and competitive solution. The goal is to always increase or maintain gross profit. By reacting to the shift they were able to maintain prospects for their apartments and generating profits. The prices of the two bedroom apartments are a factor because of the demand of the apartments per unit during a specific timeframe and market conditions. To be strategic and maximize profits, Good Life management determined the amount of apartment units and use a pricing model to ensure they maximize profit. From a

1. Economics – the efficient allocation of the scarce means of production toward the satisfaction of human needs and wants.

This is a perfect example of a change in demand; when the demand increases, at the same or even a higher price, more quantity is demanded. In the figure below, a shift to the right in the demand curve signifies an increase in demand.

Elasticity of demand represented as “Ed” is defined as a “measure of the response of a consumer to a change in price on the quantity demanded of a good” (McConnell, 2012). Determinants for elasticity of demand would include the substitutability of a good, proportion of a consumer 's income spent on a good, the nature of the necessity of a good and the time a purchase is under consideration by the consumer. Furthermore, elasticity of demand is calculated with this formula:

One of the central notions pertaining to economics is the conception of supply and demand. In a free market economy, or even in an economy in which there may be certain regulating agencies such as governmental forces, one expects for supply to meet demand at some point (Asif, 2012). These primary market equilibrating processes affect everyone involved in that particular economy, even me. By nature people are consumers, and they must learn to balance out their desires with what it is they can reasonably afford to consume, which relates to certain notions of scarcity and choice (McConnell, 2011, p. 4).

Demand in the property sector can be defined as the quantity of space or number of units demanded at various prices (Jowsey E., 2011). The fundamental principle of demand can be identified in the figure below:

The theory of demand refers to the quantity of a product required by buyers. The relationship between demand and price assumes the behaviour of buyers and states that if all other things remain equal the demand for a commodity will decline if the price rises and will increase if the price is reduced. The relationship between price and quantity demanded is depicted by the demand curve which slopes downwards. This part of the theory gives a deeper understanding of how the actual market will react if various prices were charged. Thus, to the business community the demand curve is important as a guide to the direction that should be taken in the future. Analysing the supply/demand model and measuring past behaviour can be a good guide to the future.

Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Demand refers to how much (quantity) of a product or service is desired by buyers. The quantity demanded is the amount of a product people are willing to buy at a certain price; the relationship between price and quantity demanded is known as the demand relationship. Supply represents how much the market can offer. The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price. The correlation between price and how much of a good or service is supplied to the market is known as the supply relationship. Price, therefore, is a reflection of supply and demand.

Elasticity of demand is shown when the demands for a service or goods vary according to the price. Cross-price elasticity is shown by a change in the demand for an item relative to the change in the price of another. For substitutes, when there is a price increase of an item, there is an increase in the demand for another item. When viewing complements, if there is an increase in the price of an item, the demand for another item decreases. Income elasticity is shown when there is a change in the demand for a good relative to a change in income. This concept is shown in how people will change their spending habits when their income levels change. For