Task 2: Elasticity
For each pair of items in questions 1 and 2, determine which product is more price elastic (would
have a higher price elasticity of demand in absolute value). Explain your answer including
identifying the determinant of elasticity.
1. Holiday to Europe and a bag of rice. (1 mark) –
2. Weetbix (a brand of cereal) and electricity used in your home. (1 mark)
Read the following excerpt and answer question 4.
Need a kindergarten spot in Mongolia? Play the lottery.
Mongolia’s baby boom is pushing its schools to breaking point, with desperate parents facing the stark choice of relying on a lottery system or paying for pricey private classes in capital Ulaanbaatar. Spots in coveted government-funded kindergartens, for children aged two to five, are determined by an online ballot. Those who miss out risk being left out of the early years education system altogether — unless they can afford a feepaying option. The city’s publicly funded kindergartens have space for just half of the 146,000 children between the ages of two and five who live there, according to the municipal education department. Experts blame the shortage on bad government policy and poor long-term planning. The majority of Mongolia’s state-run schools were built during the Soviet era, and relatively few new facilities have been added since the country became democratic in 1990. Those who do get in face crammed classrooms and overburdened teachers as resources are stretched. The overcrowding also poses health risks, with germs and the flu being passed around, leaving hospitals struggling to attend to a high number of sick children. Those with a high enough income no longer even bother with the ballot as the private options offer better learning environments. “There were enough warning signs, but not enough measures taken,” Batjargal said. Birth rates soared in the Year of the Golden Pig in 2007, as Mongolians believe that year brings wealth, but little was done in anticipation of the extra demands on resources as those babies grew up. The government is building schools in the ger, or slum, districts of Ulaanbaatar, but the country’s debt problems have restricted spending. Author Khaliun Bayartsogt, Ulan Bator (AFP) Source: Seven News, Yahoo web site (https://au.news.yahoo.com/world/a/37266208/need-akindergarten-spot-in-mongolia-play-the-lottery/)
4. Given the information in the article use the demand and supply framework to analyse the market for government provided childcare services. In a separate graph analyse the market for private childcare services. In your answer discuss the elasticity of supply in each case and contrast between the two markets. In addition, identify any shortage or surplus in each market. (4 marks) –
Task 3: Costs of Production
1. Suppose the total cost of producing 10 000 tennis balls is $60 000 and the fixed cost is $20 000. What is the variable cost? When output is 10 000, what are the average variable cost and the average fixed cost? (1 mark) – Maximum number of words 40 + calculations
2. Suppose you go to university and live in a residential college on campus. You pay the college for your room and board. Assume that you would have had to move out of home (with your parents) whether you went to university or taken up a full time job, and that you used some of your savings as payment for tuition). What are two examples of an explicit opportunity cost of attending university? What are two examples of an implicit opportunity cost of attending university? What is an example of a cost of attending university that is not an opportunity cost? (2 marks) – Maximum number of words 100
Task 4: Market Power
2. Explain why a firm in a perfectly competitive market charges the market price (as set by the market demand and market supply curve). How is this different to a firm in a monopolistically competitive market? (2 marks) –
Task 5: Business Strategy
Assume that two interior design companies, Alistair and Baine, are competing for customers and, if they both advertise, they would each earn $30 million in profits. If neither advertises, they each earn $50 million in profits. If one advertises and the other doesn’t, the firm that advertises earns $40 million in profit while the other earns $20 million in profit.
1. Present the information above in the form of a payoff matrix. Let Baine be the row player and Alistair the column player. (1 mark) – No words are required only payoff matrix
2. Define Nash equilibrium. What is (are) the Nash equilibrium(s) in this game. Explain. (2 marks) –
3. Define dominant strategy. Is there a dominant strategy for Baine and, if so, what is it? Explain. (2 marks)
The capacity of managing startling and sudden occasions that irritates groups and changes in association culture is known as emergency administration. As of late we have possessed the capacity to palpate transboundary emergency, that have influenced partners in various structures. For instance, the 2011 tidal wave of Japan, which interfered with production network everywhere throughout the world, particularly in the car business (Crandall, Parnell and Spillan, 2010). This craft of managing emergency requires aptitudes and information to sort out partners' recuperation. Emergency administration readies the individual to create abilities in a surprising and unfriendly conditions inside the association of a crisis reaction with bravery and assurance. The coordination of the crisis reactions to a more extensive episode that debilitates to hurt and wreck structures, capacity to work viably and proficiently. The continuum assessment of the arranging and programmed episode reaction turns into a noteworthy piece of the procedure in an emergency administration design. Authoritative assets accessible in an emergency in Dominican Republic. As per Crandall, Parnell and Spillan (2014) there are nations and societies that are known as "emergencies arranged", on the grounds that they have possessed the capacity to prepare and bolster any emergency wanting to conquer their shortcoming. The Dominican Republic isn't the special case, when an emergency emerges the group and Dominican Civil Defense are the first to react to the crisis, as people on call. All things considered, not every person is set up to help someone else or accept a part of initiative during the time spent a crisis emergency. The national crisis and correspondence framework, known as the Center for Emergencies Operation, [COE], in its part of the main office across the country in an emergency, and reacting association has possessed the capacity to create skill and capacities to help potential emergencies and deal with the ones that in the end happen. The Center for Emergencies Operation, [COE], is qualified for create, survey, execute and prepare faculty, volunteers and the group in reference to the national arrangement and administration for crises across the country. The Dominican Civil Defense, are the person on call for the scene of a cataclysmic event or emergency. This is one of the crisis gatherings, in any event, most referred to in the nation as prepared specialists on call for a crisis. The Dominican Civil Defense started their group benefits as a gathering of volunteers to the group by giving correspondence benefits as radio beginner by 1963. Their first authority support to the group was with Hurricane Flora, where they demonstrated how they were successful in giving correspondence across the country under a crisis debacle as a tropical storm. The Dominican Red Cross enabled them to station their focal correspondence inside their middle. By, 1966, the Dominican government ordered the Law 257, which made the Dominican Civil Defense as an official living being to help crises. Along these lines, turning into an official state establishment under the umbrella of the Center of Emergencies Operation, COE. In September 22, 2002, the legislature instituted the Law 147-02 by which the hazard administration, turned into the official crisis administrative Agency responsible for building up the national crisis and correspondence design alongside its controls. As general standards they keep to ensure, arrange, take an interest, show counteractive action and decentralize administrations. Their essential objective is to avoid or decrease loss of lives and limit property harms of regular folks and government from catastrophic events or artificial calamities. The Dominican Civil Defense, is one the creatures under the umbrella of COE, and in addition the Dominican Red Cross, Energy Conservation Department, Fire Department, Police Department, Dominican Port Authority, Health Department, Environment and Natural Resources Department, Dominican Seismological Institute, National Housing Department, among others, have been perceived as a crisis emergency group of experts and experts nearby, national and globally for its work group in the interest of those in require and the group. On account of the Dominican Civil Defense, their labor is made out of 95% of consistent prepared volunteers, an official chief, an officer corps, and departmental supervisors who, as indicated by their scholarly readiness start working for the group and the advantage of the nation. As indicated by Treurniet, Van Buul-Besseling and Wolbers (2012) the group might be characterized as a gathering of individuals living in a similar territory and having a specific attributes in like manner of being a person. Furthermore, accordingly, they will have a place with various gatherings and groups, sharing their comprehension of a genuine dynamic group work, towards each other. By 2014, the Dominican Republic executed without precedent for its history the administrations of 911. As one of the new crisis asset administrations focus, its experts in control wanted to instruct enormously the populace about the utilization and advantages of 911. The correspondence methodology was enormously utilized (TV and radio) amid the accompanying two months preceding the actuation of the 911 framework across the nation. Pearson and Mitroff (1993) communicated that there is a need of teaming up with the group, since it gives a feeling of being part dynamic inside the group. Moreover, they clarified that the group can share their desires, evaluating their necessities and objectives of the individuals who are requiring help. During emergency, the learning of teaming up formally or casually with associations in achieving one objective of assisting someone else turns into a versatile conduct (James and Gilliland, 2013). In the Dominican Republic, Center for Emergency and Communication Operations, [COE] would be comparative in its capacity to what FEMA is in the United States. The Dominican Civil Defense is assigned under the umbrella of the COE. This Center would be part basic of the Crisis Management Team, CMT and the Crisis Management Plan, CMP. COE organizes steady trainings with national and global organizations who are additionally managing crises and emergency keeping in mind the end goal to trade encounters and prepare with new procedures. Today, the Dominican Civil Defense has turned out to be one of the organizations of the Government that has extraordinary compared to other correspondence arranges in the nation after the Armed Forces. They have a correspondence framework in the UHF band or ''ultra-high recurrence" as of late introduced, and an armada framework is national in scope, notwithstanding ordinary telephones. As of now, the Dominican Civil Defense has a radio station, which is the spirit of the establishment in emergency and crises that work 24 hours per day and the 365 days of the year (Dominican Civil Defense, 2014). Emergency Theories. Hypotheses influence a few presumptions to give a clarification of a given circumstance. A few creators, for example, James and Gilliland (2013) clarifies that the Eclectic Crisis Intervention Theory involves a purposeful and deliberate specifically coordinated substantial ideas and techniques to help the casualties from various methodologies. This specific hypothesis starts filling in as an undertaking focused hypothesis, rather than utilizing ideas. A few noteworthy undertakings recognized in this hypothesis are: Distinguish components in all frameworks and to coordinate them into an inside reliable entire giving a more precise behavioral information to be clarified. Think about every single existent hypothesis, techniques, and principles for assessing and controlling clinical information as per the propelled learning of time and place. The need to relate to no particular hypothesis, with a receptive outlook and ceaselessly explore different avenues regarding those details and systems that deliver victories. This specific hypothesis incorporates two inescapable topics. The first of those subject is that individuals and all emergencies are one of a kind and unmistakable, subsequently can apply to anybody and any sort of culture. Besides, all individuals and all emergencies are comparable. Consequently, James and Gilliland (2013) comprehends that these suspicions are viewed as totally unrelated. The mixed approach, as indicated by James and Gilliland (2013) give a chance to various methodologies and speculations, in this manner, it enables the chance of having the capacity to evaluate the casualty's needs keeping in mind the end goal to apply and design the proper strategies customized to the individual. The specialist, then again, will go out on a limb and will have the eagerness to change a way to deal with another procedure regardless of whether the first had work. In any case, the Interpersonal hypothesis fundamentally clarifies that individuals can not support an individual condition of an emergency for long, on the off chance that they truly have confidence in themselves and in others. Having certainty, the individual will wind up self-realized and defeat the emergency (James and Gilliland, 2013). Crandall, Parnell and Spillan (2014) clarified that the basic objective of the emergency administration group, CMT is to prepare for potential emergencies and deal with those emergencies that in the long run happen. Thusly, it will be viewed in three viewpoints, emergency reaction associations and audit their connection between associations. Moral and lawful difficulties. Crandall, Parnell and Spillan (2014) gave a comprehension of the significance of moral and lawful duties and difficulties when managing associations and their social boundaries. The moral culture of the associations the vast majority of time is being imperfect due to the dishonest conduct performed by its workers, and paying little mind to their composed code of morals. For instance, farfetched objectives of associations, may lead workers to doubtful basic leadership. In this manner, workers may feel, that they ought to cause in exploitative conduct to get the objective by undermining hierarchical strategies (Crandall, Parnell and Spillan, 2014). Then again, moral norms are not considered to have legitimate weight just, as per James and Gilliland (2013); clarifies that the Eclectic Crisis Intervention Theory involves a purposeful and efficient specifically coordinated legitimate ideas and methodologies to help the casualties from various methodologies. This specific hypothesis starts filling in as an assignment arranged hypothesis, rather than utilizing ideas. A few noteworthy undertakings recognized in this hypothesis are: Distinguish components in all frameworks and to incorporate them into an inside reliable entire giving a more exact behavioral information to be clarified. Think about every single existent hypothesis, strategies, and principles for assessing and controlling clinical information as indicated by the propelled learning of time and place. The need to relate to no particular hypothesis, with a receptive outlook and persistently explore different avenues regarding those definitions and methodologies that deliver victories. This specific hypothesis coordinates two inescapable topics. The first of those topic is that individuals and all emergencies are interesting and unmistakable, thusly can apply to anybody and any sort of culture. Also, all individuals and all emergencies are comparable. Subsequently, James and Gilliland (2013) comprehends that these suppositions are viewed as fundamentally unrelated. The varied approach, as per James and Gilliland (2013) give a chance to various methodologies and speculations, accordingly, it enables the chance of having the capacity to evaluate the casualty's needs keeping in mind the end goal to apply and design the proper strategies customized to the individual. The advisor, then again, will go out on a limb and will have the readiness to change a way to deal with another strategy regardless of whether the first had work. In any case, the Interpersonal hypothesis generally clarifies that individuals can not support an individual condition of an emergency for long, in the event that they truly trust in themselves and in others. Having certainty, the individual will end up self-realized and defeat the emergency (James and Gilliland, 2013). Crandall, Parnell and Spillan (2014) clarified that the central objective of the emergency administration group, CMT is to prepare for potential emergencies and deal with those emergencies that in the long run happen. In this way, it will be viewed in three perspectives, emergency reaction associations and survey their connection between associations. Moral and legitimate difficulties. Crandall, Parnell and Spillan (2014) gave a comprehension of the significance of moral and legitimate duties and difficulties when managing associations and their social boundaries. The moral culture of the associations the greater part of time is being flawed on account of the unscrupulous conduct performed by its workers, and paying little mind to their composed code of morals. For instance, implausible objectives of associations, may lead representatives to improbable basic leadership. Hence, workers may feel, that they ought to bring about in dishonest conduct to acquire the objective by undermining authoritative techniques (Crandall, Parnell and Spillan, 2014). Then again, moral gauges are not considered to have legitimate weight just, as per James and Gilliland (2013); despite the fact that these norms issues are centered more around managing codes of behaviors to the calling. Infringement of these codes can and will lead any expert to be scold or may lose their permit commanded by the calling's morals board. As indicated by Reyes and Jacobs (2006) clarified that the procedure facilitates and defeat multicultural boundaries and difficulties, for example, dialect, convictions, coordinations, and maintainability. Besides, it might diminish allegations of social lack of care. A case of this might be look at when as an association does not faith in huge religious occasions, and their representatives must present themselves to work, against their convictions and the association. Associations must create standard moral lead rules, which must execute morals trainings so as to feature moral issues and how they may respond to the emergency (Crandall, Parnell and Spillan, 2014). Moral standards may have a tremendous and differed discernment, associations and additionally people on call must be put aside their convictions keeping in mind the end goal to reach and help the emergency. Along these lines, empowering adapting practices predictable to the individual's convictions, and traditions enable morals minorities to comprehend the administration and mending process (Reyes and Jacobs, 2006). All through the procedure of emergency administration and the people on call, winds up basic to grasp what their part is in this procedure with a specific end goal to give the proper social help to the association and its staff in require. By and by, as indicated by Crandall, Parnell and Spillan (2014) there are a few recommendations or rules that may better moral culture codes that can enhance radically the instructor execution when there are multicultural difficulties or obstructions when overseeing and reacting to emergencies. One of these proposals may maintain a strategic distance from, when an exploitative conduct is found. For this situation, the association must react promptly to amend the circumstance and train the individual in charge of the conduct acquire against the moral rules codes. Another recommendation to beat practices that disregard moral, legitimate and multicultural difficulties or obstructions, is enlisting a boss, officer or chief of morals. This individual duties as an officer, boss or executive which would serve in top administration or governing body, who additionally will answer to the most extreme level of the association whether this is an open or private one. This position will advance the moral principles of the association and in addition its way of life; guaranteeing the workers conduct along tending to their worries and needs. In a comparable circumstance, Crandall, Parnell and Spillan (2014) recommended that supervisors, executive or presidents should require to have practical objectives. These objectives are effectively thought out, something else, unreasonable objectives empowers exploitative choice and thusly conduct among workers. Along this proposal, top administration or official chiefs, may give a hotline number as well as email in which workers have a man or division inside their association that they can trust and to whom they can report untrustworthy practices or moral infringement keep up its classification. This particular proposal may help representatives to report any sort of deceptive direct that they or another worker might confront. >GET ANSWER