Eco/365

Supply and Demand Simulation

James Jennings

ECO 365

April 29, 2013

John Waltbillig

In the simulation, it presents various scenarios using the microeconomics and macroeconomics simultaneously in order to achieve the overall goal of increasing profits for the company and staying competitive in the market of rental properties in Atlantis. This is prevalent in scenario in the way problems are presented. The simulation requires the student to apply the concepts in a manner that teachers the dynamics of microeconomics and macroeconomics. The firms reactions to economic environment shows that the firm’s actions to stay profitable consists of microeconomic principles yet the adversities the firm is confronting is from macroeconomic sources which requires using principles of each one to be successful.

Microeconomics reviews the action of individual persons or business entities with an emphasis on supply and demand theories and practical applications and how these things determine supply and demand in specific markets. For example, the simulation presented a query concerning lowering rental prices to eliminate the number of vacant units. However, the firm wanted to accomplish this while still making money. This concept uses microeconomics to address the issue and the simulations allows the student to use a supply and demand chart to query all the possibilities in order to assist the company or individual in making sound business decisions. Another example is when the simulation posed the idea that a new company was opening locally and would result in an increase in population that would bring about the need for more housing. A possible increase in demand of this type with a limited supply allows the firm to consider raising rates for new leases and asking for implementing increases on renewals knowing the choices in the area are very limited.

Macroeconomics reviews the overall economy and all the dynamics associated with it such as unemployment rates and...