ECO10250: Economics- Report Writing Assignment

Internal Code: MAS1071

Report Writing Assignment:

Question 1: a. Explain the link between scarcity, choice and the production possibility curve. In your answer use graphs and include a description of the three concepts in your own words. b. Outline the major factors that determine the type of economic system existing in a country. Based on the factors you noted above, describe the principal differences between the Australian economy and the Chinese economy Question 2: a. There has been a breakthrough in the manufacturing of solar-powered motor vehicles that will substantially reduce their costs of production. Use demand and supply curves to illustrate what will happen to: i) the equilibrium price and quantity of solar-powered motor vehicles. ii) the equilibrium price and quantity of conventional motor vehicles. (Parts i and ii are worth 2 marks each.) b. In an attempt to increase the use of solar-powered motor vehicles the government decides to set a minimum price for solar-powered vehicles that is below the market price. Do you think this is a good idea? Explain your decision using graphs. Question 3 Explain what will happen to consumer and producer surplus and deadweight loss if the government imposes a tax on sellers for each radio they produce in order to raise government income? Include in your answer an explanation of the three concepts – consumer surplus, producer surplus and deadweight loss.