Supply and Demand Simulation

The purpose of the simulation is to familiarize a user with the demand curve, supply curve, equilibrium, and price ceiling. As a property manager for GoodLife Management in Atlantis, the responsibility for maintaining reasonable rental rates and quantity of apartments demanded involves several factors. Personal preferences, economy, income, and rental rates all affect the vacancy and occupancy ratios. Decisions regarding supply, demand, and month-to-month rental pricing all require careful evaluation. Regular monitoring of supply and demand is necessary to remain competitive in the ever-changing economy everyone lives in. As the community evolves, GoodLife Management must make accommodations to remain viable in the real estate industry. Further discussion of this paper summarizes the content of this simulation while applying to an organization providing financial services, the causes of changes in supply and demand, shifts in supply and demand affecting decision making, key points from classroom reading assignments emphasized in simulation, and how price elasticity of demand affects the decision making of the consumer and of the organization.

English: Diagram illustrating the "aggregate suppl...

The illustration that accompanied Marshall's origi...

Perfectly inelastic demand

GoodLife Management is the only firm in Atlantis managing seven different complexes. The simulation allows the user to play a management role with responsibilities of receiving 30-day vacate notices, setting advertising schedules, and establishing new rental rates. Throughout the first year, the user is required to select a rental rate, which will decrease the vacancy rate below fifteen percent from an initial twenty-eight percent meanwhile, maximizing revenue. This proves an increase in quantity demanded at a lower price as more potential tenants are willing to rent apartments at a lower vacancy rate. As the rental rate is lowered, revenue initially increases, reaching a maximum at a particular rental rate and quantity demanded which then decreases. Two years later, the National Property manager, Susan Hearst, decides to maintain a zero percent vacancy rate...