Principles of Microeconomics Essay

allow for and drive is a phrase that every one hears in one way or another, Supply and drive phrase according to Colander, (2010) is the most used phrase by economic expert and the reason is because the phrase provides a good off-the-cuff answer for more question that have to do with economy. Example why are spare-time activity roves to Low? Because preparation and call for. Why is Gasoline so risque? tot up and crave. This paper impart speak about a dis seeming found on University of Phoenix student website, simulation named Applying Supply and Demand Concepts This paper will speak about macroeconomics and microeconomics principles, Paper will excessively refer to shift of the bring curve and shift of the demand curve. too how the how ideas of Microeconomics and macroeconomics help understand the factors that affect shifts in supply and demand on the equilibrium price and quantity, and last how the price elasticity of demand affects a consumers purchasing and the fi rms pricing st measuregy.Microeconomics and Macroeconomic Principles match to Colander (2010) Microeconomics is define as the take of individual choice, and how that choice is influenced by economic forces. With this in mind, principles present on the Applying Supply and Demand Concepts simulation are Rental unit Prices and Rental units supply. According to Colander (2010) Macroeconomics is defines is the study of the economy as a whole. With this in mind one target say that macroeconomics principles on this simulation are population trends that lead pot to choose to assume or not rest and factors that lead people to make this type of choices.According to Colander (2010), states that Demand can be defined as sum demanded rises as price falls, other things constant. Or alternatively Quantity demanded falls as price rises, other things constant. And on the other hand Supply can be defined as Quantity supplied rises as price rises, other things constant. Or alternatively Quantity supplied falls as price falls, other things constant. (Colander, 2010) On the simulation supply of two bedrooms apartment has reach 2,000 and according to the analyst, gild neediness to go down vacancy steps to 15% in order to increase revenue. By decreasing rent demand will increase vacancy will decrease and revenue will increase.Shifts of the Supply and Demand CurvesAs the supply of apartment increases the supply curve shifts towards the right as direct allow for of apartment supply increase rental rate also increases. derive of apartment supply is 2,500 and by leasing all of the apartment rental rate will be driven to $1,500. Because demand curve shift downwardly when rent rate and apartment supply increases, by increase rent rate to $1,500 demand will lower and in order to put through equilibrium, union would need to lower rental rate to $1,050. This is where the supply and demand reaches equilibrium.Relevance in Real World and at the WorkplaceSupply and demand is a fa mous phrase as previously pay heed and one dont realize that this phrase or concept applies to one personal life in a lot of ways. For modelling I work for a brim and we sell services to client in the form of banking, delivery or investment products. From a Macroeconomic prospective all of us a one point need to have a bank account of in order to action many financial needs, it is because of these need that there is always demand for banking products. It is base on this demand that interest rates for savings accounts varies based on the demand the supply (interest rates) varies. From a microeconomics prospective if outside indicators like foodstuff condition or unemployment rate lurchs rates for saving account will also transport.It is based on those factors that sometimes people decides to stop saving and bank will to increase saving rates but bank can only do it to a certain point because increasing saving rates to much will mean that lending funds will have a higher rat e. There is got to be balance. reasonableness the concepts of macroeconomics andmicroeconomics help understand factor that affects shifts in supply and demand because straightway one can see with clarity what are the categories and what those categories are, the ones influence supply and demand and how this same factor may bring equilibrium.Price shot of DemandAccording to Colander (2010), the price elasticity of demand is the portion deepen in quantity demanded divided by the percentage change in price. As for this simulation, if the demand experiences a negative percentage change (if it decreases) the price of renting an apartment will also decrease. So, rental rate will decreases as the demand decreases. On the other hand, when the supply decreases or increases, the rental rate will remain constant. If the demand increases, the rental rate will be increased, since more people will want apartments (the company is able to increase the prices the law of demand). According to C olander (2010) Price childs play of Demand can be defined as the percentage change in quantity demanded divided by the percentage change in priceConclusionThis paper has referred to various terms from the macroeconomic and microeconomic environment. It has analyzed trends and also shifts of the supply and demand curve for a company that rents two-bedroom apartments in Atlantis. The paper has also referred to situation from the real world where microeconomic concepts can be applied. Last, it has talked about price elasticity of demand with see to the company that rents apartments. The paper serves as an element of understanding supply and demand concepts when it comes to the microeconomic environment.ReferenceColander, D. C. (2010). Economics (8th ed.). New York, NY McGraw-Hill. University of Phoenix. (). Applying Supply and Demand Concepts Multimedia. Retrieved from University of Phoenix, ECO/265 Principles of Microeconomics website.