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- Date Submitted: 03/29/2015 02:01 AM
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Supply and Demand Stimulation
Patrese Smith
ECO/365
3/23/2015
Joseph Compton
Atlantis is a well maintained city that offers its residents ample parks, easy freeway access and, well maintained sidewalks which allow residents to walk, jog and ride their bicycles. Crime rate is low. Good Life Management is a property management organization that manages seven apartment complexes within the City. Good Life Management is the only company that rents apartment units. Good Life Management has office locations around the U.S. With over 2,000 two-bedroom apartments and only a 28% vacancy rate, it is important to use the supply and demand curve to determine the equilibrium in the market. It is also important to understand and differentiate between movements along and shift of the demand and supply curves to determine how the equilibrium is re-established after the shift in curves.
Microeconomic and Macroeconomic Principles
Some of the microeconomic principles present in the simulation include supply and demand. The simulation mentions decreasing the rent amount in order to lower the percentage of vacancy to 15% which would maximize revenue for Good Life management firm. When Lintech arrived in town, it not only increased the population and jobs, it also increased the demand for housing which applied to both vacant apartments and renewal of leases.
Macroeconomics within the simulation include the fact that the government was forced to step in and create a ceiling of $1550 for monthly rent on the two bedroom apartments specifically aimed at middle-income families. This ceiling was created solely for the purpose of allowing those families the financial flexibility to live in the city they work in. The Atlantis housing survey revealed some shocking information because some residents were considering renting Oakridge’s detached homes because the constant rise in price.
Shifts of Supply Curve and Shifts of Demand Curve
In the simulation,...
Patrese Smith
ECO/365
3/23/2015
Joseph Compton
Atlantis is a well maintained city that offers its residents ample parks, easy freeway access and, well maintained sidewalks which allow residents to walk, jog and ride their bicycles. Crime rate is low. Good Life Management is a property management organization that manages seven apartment complexes within the City. Good Life Management is the only company that rents apartment units. Good Life Management has office locations around the U.S. With over 2,000 two-bedroom apartments and only a 28% vacancy rate, it is important to use the supply and demand curve to determine the equilibrium in the market. It is also important to understand and differentiate between movements along and shift of the demand and supply curves to determine how the equilibrium is re-established after the shift in curves.
Microeconomic and Macroeconomic Principles
Some of the microeconomic principles present in the simulation include supply and demand. The simulation mentions decreasing the rent amount in order to lower the percentage of vacancy to 15% which would maximize revenue for Good Life management firm. When Lintech arrived in town, it not only increased the population and jobs, it also increased the demand for housing which applied to both vacant apartments and renewal of leases.
Macroeconomics within the simulation include the fact that the government was forced to step in and create a ceiling of $1550 for monthly rent on the two bedroom apartments specifically aimed at middle-income families. This ceiling was created solely for the purpose of allowing those families the financial flexibility to live in the city they work in. The Atlantis housing survey revealed some shocking information because some residents were considering renting Oakridge’s detached homes because the constant rise in price.
Shifts of Supply Curve and Shifts of Demand Curve
In the simulation,...