Supply And Demand Simulation Analysis

P.1 Supply and Demand Simulation Kandice Porter ECO / 365 10 / 13 / 2014 Ronald Merchant
This is where the supply of goods and services are proportioned with the demand for the goods and services which are the exact same. The simulation, shows how this works by where the apartment supply connects with the market and the price demanded by the supply and demand forces. In the beginning the equilibrium price was $1050.00 dollars, and the supply of two bedroom apartments was 2000 units. The demand curve shifted right because of the population increase with the opening of the Lintech Company which also lead to the price increase on the remaining apartments with the supply price staying constant. With this being said, it is good decision-making, on the suppliers part to increase
In decreasing the demand for the two bedroom apartments because of the preference changes the supply of the apartments also decrease, meaning both the supply and demand curve shifts to the left. The equilibrium for rental rates as well as the quantity is completely dependent on the stronger of the two effects. If there is a shortage at the equilibrium rental rate then the supply of apartments will be less than what is demanded. This goes without saying but the company would have to offer less two bedroom apartment units than the renter will want to spend on them. The rental rate would show a need to have to increase until the quantity demanded decreases resolving the shortage. This process continues until there is a new point reached in the