Supply And Demand Simulation Research Paper
Supply and Demand Simulation
ECO/365
November 27, 2012
William Mason
Supply and Demand Simulation
This supply and demand simulation teaches how to respond to changes due to the shifts in the market. Whenever there is a change that means several factors that need to be looked at. A number of factors, including price increases or decreases, cause changes in supply and demand. If demand rises, the supplier should increase supply to achieve larger profits from increased sales at higher prices. An increase in the rental price of two roomed apartments caused a decrease in the demand of houses by a large margin. Suppliers were willing to supply more houses at higher prices and fewer homes at reduced rents.
A rise in the population of Atlantis …show more content…
Because of this result the suppliers increased the supply of detached homes.
A negative shift in demand results in smaller amounts and because of this suppliers have to reduce supply. A positive shift in demand leads to a rise in amounts demanded and a positive shift in supply as suppliers get ready to take advantage of higher prices. As a supplier, the lower the price means the less the individual can supply to the market during a bid to raise the prices when demand increases (Griffiths & Wall, 2000). With a rise in demand, an individual would supply more units to the market so that they can make a profit from higher rental prices.
The concepts of demand and supply, as demonstrated in the simulation, teach how to respond to changes due to shifts in market fundamentals. Whenever there is a change in demand due to any of the factors affecting it, an entrepreneur should be quick to respond appropriately to maintain one’s share of the market. This may involve lowering the price and a reduction in the number of units supplied. In the event that demand rises, the supplier should increase supply to higher profits from increased sales at higher prices. In different situations, it may be smarter for the company to invest in products that the consumers prefer rather than having high price fights (Griffiths & Wall,
ECO/365
November 27, 2012
William Mason
Supply and Demand Simulation
This supply and demand simulation teaches how to respond to changes due to the shifts in the market. Whenever there is a change that means several factors that need to be looked at. A number of factors, including price increases or decreases, cause changes in supply and demand. If demand rises, the supplier should increase supply to achieve larger profits from increased sales at higher prices. An increase in the rental price of two roomed apartments caused a decrease in the demand of houses by a large margin. Suppliers were willing to supply more houses at higher prices and fewer homes at reduced rents.
A rise in the population of Atlantis …show more content…
Because of this result the suppliers increased the supply of detached homes.
A negative shift in demand results in smaller amounts and because of this suppliers have to reduce supply. A positive shift in demand leads to a rise in amounts demanded and a positive shift in supply as suppliers get ready to take advantage of higher prices. As a supplier, the lower the price means the less the individual can supply to the market during a bid to raise the prices when demand increases (Griffiths & Wall, 2000). With a rise in demand, an individual would supply more units to the market so that they can make a profit from higher rental prices.
The concepts of demand and supply, as demonstrated in the simulation, teach how to respond to changes due to shifts in market fundamentals. Whenever there is a change in demand due to any of the factors affecting it, an entrepreneur should be quick to respond appropriately to maintain one’s share of the market. This may involve lowering the price and a reduction in the number of units supplied. In the event that demand rises, the supplier should increase supply to higher profits from increased sales at higher prices. In different situations, it may be smarter for the company to invest in products that the consumers prefer rather than having high price fights (Griffiths & Wall,