Supply and Demand Simulation Paper

886 WordsJun 27, 20134 Pages
Supply 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 show for each shift, how it would affect the equilibrium price, quantity, and decision making. It will detail application to learned material about supply and demand from the simulation to workplace or real-world product. It will detail how concepts…show more content…
The simulation is a model with no right or wrong answers, and has rational expectations of both the person using the simulation and the person reading the analysis of the data from the analysis. This is in the category of macroeconomics because it deals with the “big picture” of the analysis’ expectations. The second macroeconomic concept the simulation deals with is adaptive expectations. The simulation uses information from the simulation, and tries to simulate how GoodLife will encounter different problems basing the information on past events. This is in the category of macroeconomics because it shows a larger picture of the company and how it will adapt its expectations in years to come. The analysis shows a supply curve, “which is an imaginary line at a point in time telling the quantity a supplier provides at various prices of the product” according to dictionary (dictionary, 2013). The cause of the supply curve in the simulation is that the rates of the apartment rentals went up, and so did the number of apartments GoodLife was willing to rent. This made the supply curve slope upward, as the goal is to rent out every apartment. The equilibrium price is $1550, and the quantity is 2500 apartments. Recently my family moved into a new apartment complex. The complex was advertising a move-in special of $199 for the first month total move-in costs. This was a good advertisement, and brought in many new tenants to the apartment

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