Project Authors
- Nick Gardner
- Brandon Emons
- Israfil Brandon
The Vensim Model
This is a supply/demand model with price added in. The goal of this model is to figure out the variables involved and determine how each variable factors into other variables.
The Inventory Section
Variables in this section:- Demand: The rate consumers wish to use up the oil
- Demand Price Schedule: a demand curve; the higher the price the lower the demand, the lower the price the higher the demand
- Price: The cost of one unit of gas
The Supply and Demand Section
Some important factors:- Supply Price Schedule: a supply curve; the higher the price the more likely producers are to produce
- Inventory Ratio: Ratio of inventory to desired inventory
- Desired Inventory: The amount of inventory that suppliers want
- Desired Inventory Coverage: How many units of oil that suppliers want to keep per unit time
Variables in this section:
- Supply: The rate oil is produced
- Total Gas Reserves: How much oil is currently owned
- Shipment: The rate consumers actually use up oil
The Price Section
Variables in this section:- Effect on price: How much price changes
- Desired Price: The "equilibrium price"
- Equilibrium price: When the rate of the quantity of a product is equal to the rate of demand of a product
- Change in Price: How much the price changes depending on the price change delay, desired price and actual gas price
- Price Change Delay: How long it takes for the price to change, price does not change right away
Conclusion
Vensim is a very useful modeling tool but there are some downsides. The graphs in vensim are not very useful and are a pain to create. You can clearly tell thatvensim is mainly for determining the variables and figuring out which variable effects what. Compared to excel, vensim is not as useful for numbers.