Supply and Demand Simulation Supply and Demand processes are shown in a simulation provided by University of Phoenix called “Applying Supply and Demand Concepts” (UoP, 2008). The simulation is based on an apartment management group named GoodLife Management. GoodLife is based out of a town called Atlantis. The company rents two bedroom apartments on temporary leases. This simulation takes place over a period of nine years. During this period, several factors are included in the simulation to show differences in demand, supply, rental prices, and shortages. The first simulation shows demand curves and how the curve is affected by changes in rental prices, vacancy rates and quantity of apartments demanded. Every change has a consequence. Some changes are good, while others cause detrimental outcomes for the company. This first section of the simulation showed how changes in the vacancy rate and rental rate can change the number of units rented and the possible revenue to be received. The task was to “determine the monthly rental rate to ensure that more two-bedroom apartments are occupied and that revenue is maximized” (UoP, 2008). The optimum choice was to lower the rental rate to $950. This change in rental price allowed 1,900 units to be rented, leaving a surplus of 100. This also brought the vacancy rate to 5% and the revenue to $1.81 million. The second simulation reflects the task of renting out all available apartments, leaving a vacancy rate of 0%. The variable in this scenario is the number of apartments rented compared to the rental rate. In order to rent out all 2,500 apartments, the GoodLife Management group must raise the rental rate of each unit to $1,550. The third section of the simulation reflects equilibrium and how changes can af ...