ECON20039 Economics for Managers
Term 3 – 2022
Assessment 2 – Research Essay
Due date: 11 January 2023 (Wednesday of Week 7) 11.45 pm AEST
Weighting: 35%
Length: Approximately 3000 words (excluding graphs, tables and reference list)
Important Note Based on the microeconomic topics covering Chapters 1-10. Please note that this assessment requires substantial research (see the assessment criteria below).
No submissions including automatically submitted by Moodle will be reverted to the draft after the due date.
Objectives
This assessment item relates to course learning outcomes 1 and 2 as listed in the Unit Profile.
This research assignment has two questions.
Q1……………………………………………………………………………………………….. (Total 15 marks)
Explain the concept of the price elasticity of demand and using the economic journals identify estimates of the price elasticity of demand for at least two different products (one for inelastic and one for elastic). The price elasticity of demand is a measure of how responsive the quantity demanded of a good or service is to changes in its price. It is calculated by dividing the percentage change in the quantity demanded by the percentage change in the price. If the elasticity is greater than one, the good or service is considered to be price elastic, meaning that a small change in price will result in a larger change in the quantity demanded. If the elasticity is less than one, the good or service is considered to be price inelastic, meaning that a small change in price will result in a smaller change in the quantity demanded.
There are several factors that can affect the price elasticity of demand, including the availability of substitutes, the proportion of income spent on the good or service, and the necessity of the good or service.
Here are two examples of products with different price elasticities of demand:
Inelastic: Prescription drugs. Prescription drugs are often considered to be price inelastic because they are often necessary for the treatment of medical conditions and there may not be many substitutes available. As a result, people may be willing to pay a higher price for them even if the price increases.
Elastic: Luxury goods. Luxury goods are often considered to be price elastic because they are not necessary for basic survival and there may be many substitutes available. As a result, people may be less willing to pay a higher price for them if the price increases.
To find estimates of the price elasticity of demand for specific products, you could try looking at economic journals or other academic sources. These sources may provide estimates based on research studies or data analysis. It is important to note that the price elasticity of demand can vary depending on the specific circumstances and may change over time.
Comment on the magnitudes of these estimates in relation to the standard economic determinants of the price elasticity of demand. Why is it important for the producer to consider the price elasticity of demand when setting the price for the product? Using appropriate diagrams, explain the likely impact of COVID-19 on price elasticity of demand.
In answering this question, as a minimum, you need to:
explain the concept and types of price elasticity of demand and its importance in economics
identify actual elasticity of demand estimates for two products (one for inelastic and one for elastic) from economic journals and critically analyse the magnitude of these estimates
analyse the role of price elasticity of demand when setting the price for the producer
assess how is COVID-19 impacting the price elasticity of demand for goods and services
provide relevant information, use table, diagrams where appropriate.
Q2………………………………………………………………………………………………… (Total 16 Marks)
Choose an oligopoly industry from your home country that was affected by the current pandemic. Using the characteristics of market structures, compare it to the case if it would be a monopolistic competitive market. Explain the effect of pandemic on the industry using economic theory, real life data and illustrate it on a diagram. Was the government successful in reducing the impacts of pandemic on this industry?
In answering this question, as a minimum, you need to:
provide a brief description of your case study in sufficient details
use features of monopolistic competitive market structure such as number of sellers, type of product, entry conditions, profits and losses in the short and long run, advertising, research and development and appropriate diagrams to justify its oligopolistic characteristics.
analyse the effect of pandemic on market outcomes (i.e. price, sales, production, profit etc)
use economic theory and real data to analyse the effects of government measures against negative effects of pandemic on this industry
provide relevant information, use tables, diagrams where appropriate. You should use real data as much as possible.
Assessment Criteria
You must refer to the textbook in the first instance. Besides the textbook, you should also refer to a few other academic books, journal articles and relevant websites in answering these questions.
Use real life examples (with references) to support your discussion.
Answers must be complete, addressing the specific tasks nominated in the questions.
Use in-text referencing and provide a list of references.
All submissions for this course must use the American Psychological Association (APA) referencing style (details can be obtained at https://www.cqu.edu.au/student- life/services-and-facilities/referencing/cquniversity-referencing-guides).
Concepts must be defined accurately and completely.
The assumptions upon which the analysis is based must be stated at the onset.
Diagrams must be drawn properly, correctly labelled and the relations they depict explained.
Photocopied and scanned graphs from books, articles or websites are not acceptable. It is preferable to hand-draw a graph then scan it to insert in your file.
Remember an extension is not a gift, it is a burden.
Note: no submissions including automatically submitted by Moodle will be reverted to the draft after the due date.
In Moodle there is now a default setting, which will automatically submit your assignment for marking, if you have forgotten to click the Submit for marking button.
After an assignment’s due date and time has passed, any assignments that are still in draft mode (i.e. you have not yet submitted the assignment for marking) will be auto- submitted on your behalf.
This action will occur only once for an assignment at the due date/time. If you are submitting an assignment after the due date/time has passed, then you will still need to click the Submit for marking button as normal.
ECON 20039: Assignment-2 Marks Allocation
Student Name Campus:
Question No Mark Total Comments
Q1 15
Q2 16
Overall presentation of work, introduction, conclusion for each question, essay structure, especially use of graphs, tables and clear written expression 2
Appropriate use of referencing. 2
Total Marks 35
Marker Signature & Date
Plagiarism: the presentation of work, ideas or data of others as one’s own, without appropriate acknowledgment and referencing. Plagiarism also includes self-plagiarism.
Plagiarism is a real concern, therefore, please remember to reference in-text and provide a reference list. Do not give your assignment to anyone or copy from other students.
The following information is from the Academic Misconduct Procedure Policy available from CQUni website: https://www.cqu.edu.au/policy “
Academic Integrity or Cheating or Plagiarism is a real concern. Therefore, please do not give your assignment to any student or copy from other students. Please reference intext and end-of-text reference list.
Turnitin: Please read and understand Turnitin similarity % information. Submit draft assignment 3-4 days before the due date to check the Turnitin score. If the percentage (%) is showing in Orange or Red, then please revise the selected sections and resubmit to TurnItIn. It is acceptable to have a TurnItIn % between one and less than 25. Green is the best.
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