Supply and Demand Simulation
The supply and demand simulation is based on the management of rental apartments by GoodLife Management. The apartments are located in a fictitious town called Atlantis. 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. There are four key points in the emphasized in the simulation; 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 availability of the 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. In the simulation, as the price decreased, demand increased. The supply curve, on the other hand, is upward sloping. The quantity of two-bedroom apartments increased as the price increased. A surplus in the market for the apartments exerts downward pressure on the price. This means to attract the possible renters, GoodLife would need to lower prices. On the other hand, a shortage in the number of available apartments exerts an upward pressure on the price. To maintain the balance of quantity demanded and the quantity supplied, GoodLife would need to raise the prices. Shifts in supply and demand in the simulation were caused by several factors. Changes in the direction of GoodLife Management and the population changes within Atlantis and outlying areas had an affect on supply and demand in the simulation. Changes in the preference of the tenants caused the demand for the apartments to decrease. GoodLife Management began converting the rental apartments into condominiums that were for sell, causing a decrease in the supply at the same time as the decrease in demand. Because of this, the supply curve and the...
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