Microeconomics Case Study

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Recommended: 3 pages assingment about micro and macro economics

This assignment calls for the students to complete the Supply and Demand web simulation. The simulation is about a property management firm called Goodlife Management, who owns apartment complexes in the city of Atlantis. The simulation provides a number of different scenarios both covering information that we learned about microeconomics and macroeconomics.

Identify two microeconomics and two macroeconomics principles or concepts from the simulation. Explain why you have categorized these principles or concepts as microeconomics or macroeconomics. Microeconomics affects the immediate supply and demand of the company. In the first scenario, GoodLife has 2,000 apartments in its apartment complexes, with a 28% vacancy rate. Susan recommends reducing the rate to 15% while maximizing revenue. We achieved this goal by reducing the rental rate, getting more occupants to move in the apartments, which maximized our revenue. The next scenario, GoodLife has 2,500 apartments available on a temporary month-to-month basis at the rate of $1,100. Susan suggests that we lease out all 2,500 apartments. Though possible to lease all apartments, we are unable to do so at the current rental rate due to the fact that maintenance cost will rise as the tenant and apartment rate rise. …show more content…

The lessons taught by the simulation in regards to supply and demand teaches how the make the proper decisions when you encounter market shifts, rather it be positive or negative. Microeconomic decisions are to be made in order to meet supply and demand goal of your company. Macroeconomic decisions are sometimes forced upon your company, for instance, in the simulation when the government put a price ceiling on the rental prices of apartment units. You will have to meet that goal while trying to also maintain your own supply and demand

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