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Microeconomics and the Laws of Supply and Demand

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Microeconomics and the Laws of Supply and Demand The first microeconomic policy that I noticed in this simulation, was the company GoodLife's decision to try and reduce their rental vacancy rate while still increasing the revenue. This is a microeconomic concept because it focuses solely on the company's revenue and profit and does not take a look at how this will affect the bigger picture. By decreasing the price of rent at their apartments, they are increasing the quantity of rooms demanded. This in turn increases revenue because less apartments are empty. Another example of a microeconomic concept that is demonstrated in this simulation can be shown by GoodLife's decision to try and rent out all of their rooms. When they do this they actually have to increase the price of rent. The reasoning for this is because the more rooms that are rented out the more maintenance the company has to keep up. This is a good example showing that as you increase the price of the apartments, the number of apartments supplied to prospective clients also increases. A macroeconomic concept can be seen when the city of Atlantis begins to change and many more new companies move into the town. With the rise of the population, the city is beginning to notice more congestion in the town and a lack of housing. This is a macroeconomic concept because it the lack of housing is affecting the entire town's economics. The city also has plans on regulating the price of rent which can make it harder to reach equilibrium with a supply and demand curve for a housing company. With this concept you can also see a price ceiling because of the town limitations on rent cost so that it is more affordable for everyday families. A second macroeconomic concept that is shown in the demonstration is when the new company Lintech comes to town. When this company moves, they bring a multitude of new

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