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Supply and Demand Simulation

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Supply and Demand Simulation

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ECO365
Supply and Demand Simulation
Student Name
ECO/365 – Principles of Microeconomics
Instructor Name
Date
Introduction

Supply and Demand is a phrase that every one hears in one way or another, Supply and demand phrase according to Colander, (2010) is the most used phrase by economist and the reason is because the phrase provides a good “off-the-cuff” answer for many question that have to do with economy. Example why are interest rates to Low? Because supply and demand. Why is Gasoline so high? supply and demand. This paper will speak about a simulation found on University of Phoenix student website, simulation named “Applying Supply and Demand Concepts” This paper will speak about macroeconomics and microeconomics principles, Paper will also refer to shift of the supply curve and shift of the demand curve. Also how the how concepts of Microeconomics and Macroeconomics help understand the factors that affect shifts in supply and demand on the equilibrium price and quantity, and last how the price elasticity of demand affects a consumer’s purchasing and the firm’s pricing strategy. Microeconomics and Macroeconomic Principles

According to Colander (2010) Microeconomics is define as “the study of individual choice, and how that choice is influenced by economic forces.” With this in mind, principles present on the “Applying Supply and Demand Concepts” simulation are Rental unit Prices and Rental units supply. According to Colander (2010) Macroeconomics is defines “is the study of the economy as a whole.” With this in mind one can say that macroeconomics principles on this simulation are population trends that lead people to choose to rent or not rest and factors that lead people to make this type of choices.

According to Colander (2010), states that Demand can be defined as “Quantity demanded rises as price falls, other things constant. Or alternatively: Quantity demanded falls as price rises, other things constant.” And on the other hand Supply...