Economics Simulation Game: Market Chips

The simulation game conducted in today’s lesson put the economic systems of the price mechanism and supply and demand in the hands of the students to experience firsthand. Students were given the role of either a buyer or a seller, both parties having the aim of making a profit at the end of each round. Rounds one and two of the simulation were quite standard in that each person was simply trying to obtain the best outcome with their given circumstances, however, during round three the number of sellers was cut drastically and the number of buyers increased exponentially. Furthermore, the sellers had agreed to collectively keep the prices of their goods very high, limiting the options that the buyers had and raising the profits of all sellers in the market. With an excess of buyers and a shortage of sellers the market had become very expensive very quickly, leaving buyers with no choice but to make a loss. My understanding of the principles of the price mechanism, as well as supply and demand, has developed further as a result of experiencing both in this simulation.