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The concept for microeconomics pertaining to this simulation is the change in choice that alters the demand for family home purchases. The altering in desires from residential homes diminishes the demand only and not the existing supply. Another way to look at this microeconomic viewpoint is the effect of an unfavorable buyers economy has on the need for the residential homes. The increasingly number of families with financial means desiring to purchase homes sparks the increase in demand, while the supply of homes remains constant. This concept exemplifies the microeconomic model because microeconomics exists solely on supply and demand of corporations or individual purchasers. The adverse buyers market and the need for homes tie directly into the consumers' preferences model pertaining to the microeconomic concepts.
The illustration that accompanied Marshall's origi...
Perfectly inelastic demand
Perfectly elastic demandRemember, microeconomics is the study of individual choice and how the choices made by individuals become influenced by economic forces. On the other hand, the macroeconomic concepts relate to the cost of the homes and the invisible hand that drives to higher demand and the market rates above the equilibrium price that leads to lower demand. The influence of consumers' individual choices is mute when discussing macroeconomics. Macroeconomics is the study of the economy from a holistic perspective that relates to banking industry norms, interest rates, housing markets, and the GDP.
A swing in the demand curve comes from the difference in partiality regarding the purchase of houses. This triggers a negative swing in the demand curve as the demand of homes shrinks while the supply stays constant. Consumers reversing their desires from a residential home to a trailer home shift the demand of residential homes so...