Supply and Demand Simulation

Paper Summary:

This paper provides a summary of business decisions made by managers at the GoodLife Management Company regarding the supply and demand of rental apartments in a fictional city named Atlantis. The paper details the causes associated with the changes in supply and demand, along with how the shifts in supply and demand affect decision-making. The paper presents fundamental concepts related to the macroeconomic theory and explores the application of supply and demand on pricing.

Outline:
Abstract
Causes of Supply and Demand
Macroeconomic Theory
Conclusion

From the Paper:

"Atlantis is a small city with extensive open spaces and minimal traffic. The crime rate for the city is low creating an attractive, desirable environment for potential residents. The GoodLife management company manages a large apartment complex in Atlantis and must make decisions to attract and retain customers based on economic factors such as supply and demand."
"A supply curve slopes upward. As the quantity supplied increases, the prices will also increase. For GoodLife, this means an increase in rental rates will result in an increase of apartment rentals. Since a demand curve slopes downward, as quantity demanded increases, price will decrease. The principle associated with the demand curve means GoodLife can control the quantity demanded only by reducing the price of the rental rates."

Sample of Sources Used:

• Colander, C.D. (2004). Economics: Economic Growth, Business Cycles, Unemployment and Inflation. Chapter 22, p.1-35. The McGraw-Hill Companies, 5e.
• (n.d. 2006). Business Cycle Trends. Retrieved, June 10, 2006 from http://www.culturaleconomics.atfreeweb.com
• University of Phoenix (2006). Week Two Simulation. ECO 360 - Economics for Business Course Website: https://ecampus.phoenix.edu/secure/resource/resource.asp

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