Eco365 Supply and Demand

Supply and Demand Simulation

June 4, 2012

Supply and Demand Simulation

Introduction

Supply and demand is a fundamental concept of economics and the economy would not survive without supply and demand. The quantity of a product or service is the demand and the supply is how much the market can offer. The simulation will allow us to understand concepts and principals of microeconomics and macroeconomics. Secondly, we can easily identify shifts in the supply and demand curve. A good understanding of the concepts of microeconomics allows us to understand the factors that affect shifts in supply and demand on the prices and quantities. After reading the chapters and completing the stimulation, a better understanding of the supply and demand should be accomplished.

The demand and supply in the city of Atlantis had a curve of a downward slope and which the quantity increases as the price decreases. The GoodLife rental company can increase the quantity that is demanded just by reducing the price of the rent. Some of the people in the city of Atlantis lived in households where they owned the homes and didn’t need to rent. Consumers often have a change in demand and in the town they started to request bigger places which caused the rental company to increase their supply of rentals that are available.

The quantity demanded and supplied at the equilibrium is defined as equilibrium (Colander, 2010). When the prices are below the equilibrium the demanded quantity will exceed the supplied quantity, which will cause a shortage for the market. During a shortage for the market consumers are more likely to purchase more than usual because they are getting a good price (Colander, 2010). What I have learned will allow me to apply an expert understanding of supply and demand in the workplace. There are contract specialist positions that require you to understand the supply and demand in order to make large acquisition purchases. Understanding the concepts of supply and...