This week’s assignment examined the effects of supply and demand on the pricing and handiness of existent universe goods. In this case. the simulation looked at pricing and handiness of two sleeping room flats in the fictional metropolis of Atlantis. The simulation takes a expression at several different state of affairss. outside market factors and governmental influence. By traveling through the simulation and seting the pricing degrees of the flats and the figure that are being made available to be rented. the simulation shows the effects of things like new employers traveling into the country. lease control Torahs being put into consequence and the alteration in tendency from flats to homeownership and back once more. Microeconomicss Versus Macroeconomicss
In this simulation. constructs from the survey of both microeconomics and macroeconomics are observed. Macroeconomicss covers factors that affect the whole economic system of an country. non merely one company. Events such as scenario four’s debut of Lintech into the country changes the economic system of the full metropolis. non merely GoodLife Inc’s fiscal state of affairs. GoodLife saw an addition in demands for their flats because of the inflow of workers in the country. However. as evidenced in scenario seven. the addition in monetary value due to the addition in demand because of the inflow of concerns into Atlantis made GoodLife’s flats unaffordable by many people and the metropolis council stepped in. puting a cap on how high rent could travel. Scenarios one and three exhibit microeconomic constructs far better. with the monetary values and the equilibrating act of gross coming in from leases versus the cost of keeping those flats being decided by and impacting merely the concern of GoodLife itself. with no outside influence from other companies or governmental influence.
Supply and Demand Curves
Scenarios 1 and 2 are first-class illustrations of the supply and demand curves switching based on market or internal influences. In scenario 1. the vacancy rate of the flat composite is seeking to be reduced to 15 per centum. Therefore. this means that a decrease in rent will increase the demand for flats. make fulling more flats with renters and cut downing the figure of vacant flats. The lowering of the monetary values causes the curve to drop. as the decrease in rent makes more flats make full up with renters. therefore accomplishing lower equilibrium monetary values. Scenario 2 is a bit different. where there is a push for there to be a zero per centum vacancy rate. This means that the monetary values would hold to be increased to such a point that it would be profitable for the company to hold every flat filled when sing the increased care costs for those flats.
By raising the monetary values and make fulling the flats. this tends towards a deficit of flats. taking to higher equilibrium monetary values for the flats available. Income snap is another term heard of when discoursing things like supply and demand. As a person’s income additions. so does their rate of ingestion and their acceptable monetary value for goods. This happens often in economic upturns. where a person’s wages addition and their disbursement habits become more expensive. In the simulation. this was evidenced by the Lintech state of affairs. in which good paid workers were traveling into the metropolis and needed lodging. and GoodLife was able to increase the monetary value for their flats to cut down demand to manageable degrees and increase their net incomes. What Does It All Mean?
In my workplace. I tend to concentrate chiefly on the service side of industry as opposed to the creative activity of touchable merchandises. Thus. in my workplace our displacements tend to concentrate more on intangible factors. such as employee productiveness. client satisfaction and repetition concern. In the concern of telephone client service. we view our supply and demand in footings of how good we are run intoing the demand of calls coming in and how good we supply the desire of our clients to hold their issues resolved in a timely mode. During periods of high demand. such as the vacation season. we staff more employees to work the phones. Similar to the state of affairs in scenario 2. we have to be certain that the figure of representatives on the phone is still profitable by the concern. so while there may be a little delay clip for a client to talk with an agent. it is more profitable for the client to hold a five minute delay than to set twenty more people on the phone to run into that increased concern demand.
Macroeconomic rules come into drama when the whole market or more outside factors are involved. Examples of this in the picture game industry. which I work in. would be when the evaluation system for games are under examination. or when a new console is put on the market as competition. These outside factors affect non merely the company I work for. but every other company in the industry. from the hardware makers such as Microsoft and Sony. but besides the game studios such as Activision. EA and Rockstar Games. Microeconomic rules are caused by and consequence merely my company in peculiar. such as an update to our console package that increases call volume. or proficient issues that lead to downtime. therefore take downing client satisfaction.
In shutting. there are many factors that influence the supply and demand curve of goods and services in the economic system. Microeconomic and macroeconomic constructs bring their ain wagess and challenges to each company and let them to make up one’s mind how they will react to the market’s fluctuations while keeping their ain corporate involvements. Every concern must acknowledge and account for these figures. regardless of what they produce or sell and that equilibrating act between cost and net income. consumer value and corporate involvement. is what gives both consumer and manufacturer power in our market environment today.
Colander. D. C. ( 2010 ) . Economicss ( 8th ed. ) . New York. New york: McGraw-Hill. Applying Supply and Demand Concepts. University of Phoenix Retrieved Dec 17th. 2012 from hypertext transfer protocol: //ecampus. Phoenix. edu/secure/aapd/vendors/tata/UBAMsims/economics1/economics1_supply_demand_simulation. hypertext markup language