2008 H2 ECONS CASE STUDY

The Yuan has appreciated from to Alongside entrept port activity which made economic sense explain policy initially favoured import substitution to 65 backed by tariffs and quotas. This weakens the effectiveness of FP as a DD management tool. It could also lead to economies of scale in production. Protection is not justified in terms of economic theory – Protectionism goes against the theory of comparative advantage. The demand for such products will fall DD shift left. Based on extract 6, India has imposed tariffs on imported whisky causing such whisky to be 5 times the price of local whisky.

Registered in England and Wales Documents. Q5 Discuss the relative significance of the multiplier, the price elasticities of demand for imports and exports, and crowding out in influencing policy decisions. CSQ2 a i It appreciated. If China is indeed dumping, then action to prevent dumping will be justified as it protects EU consumers in the LR where by dumping had succeeded in increasing Chinese producer power in the EU market. Music creators will face lower entry barriers to enter the recorded music industry since they. Dumping usually occurs to drive domestic producers out of the market in order to establish monopoly power in the future. Holding other factors constant, an increase in price of electricity will result in a significant change in quantity demanded of electricity – Using concept of CED?

Telecommunication companies having market power as a result of imperfect information. Coupled with the fact that the rate of increase in price for natural gas outstripping that for all goods and services as seen in Table 1, it is clear that natural gas will have the greatest impact on hh2 cost of living. Creation of Energywatch to represent the interest of consumers also limits the ability of energy firms to monopoly price, hence improving allocative efficiency. To score Level 3, answers should consider the behavior of Oligopoly versus other types of market structures.

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2008 h2 econs case study

This will lead to a more than proportionate increase in the qty demanded of the recorded music. This would result in privatised dtudy firms focusing on profit maximisation objective.

Thus, the protection measure by India is not economically justified. In this case, the protection measures by the EU is not economically justified. Answers to Exam December wcons Documents. To score for this question, students need to bring in AC curves as this will build on the depth of analysis of the question, and enables the discussion to consider the short and long run.

2008 h2 econs case study

This represents allocative inefficiency as natural gas is not allocated to the highest bidding market. USAs rising current account deficit is seen in figure 1 and this is to be contrasted with Chinas big rise in foreign reserves. In fact price of natural gas close substitute of electricity has increased more than price of electricity between and It could also lead to economies of scale in production. For answers that are very descriptive and only able to show the link between barriers to entry and pricing decisions, it will at most score a Level 2 mark.

India does not have comparative advantage in the production of whiskey as it is unable to compete against foreign competitors. This weakens the effectiveness of FP as a DD management tool.

2008 h2 econs case study

Moreover, tightly regulated energy markets in other European countries hinder the attainment of economic efficiency in Europe? Trade is also not a zero sum game. econns

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Road congestion resulting in negative externalities due to imperfect information; OR smoking – Eg. Advantages of globalisation growing doubts is not well-founded – freer movement in trade in goods and services o positive effects from trade creation? H2 Level H2 Economics CED of electricity and other fuels is positive? For answers that are very descriptive and only able to show the link between barriers to entry and. Based on table 3, it is observed that Chinas BOT improved between and Define and explain both actual and potential economic growth may use AD-AS model or PPC Explain how actual and potential economic growth may be achieved increasing the components.

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The inefficiency of this system was revealed starkly at independence.

Body There is a need to contrast between a market structure with strong barriers to entry versus one with low or no barriers to entry and how y2 affect prices. Employer’s CPF, wage flexibility encouraged by Sutdy, IPR protection, physical infrastructure improvement, corporate tax regimes, manpower development policies all need to be critiqued.

This involves increasing expenditure on human capital and strategic alliances with firms that can make use of such labour, by offering ‘supply side support’.

H2 Economics Case Study Questions

As for other ‘real’ intra-industry trade, differences in characteristics and tastes can explain it in other words, demand as well as supply. Considering that bras is a labour intensive product, and China is labour abundant where low-skilled labour are paid lower wage rates compared to those in EU, then China may actually have the comparative advantage in producing bras.

Good answers would also consider that firms make decisions not just on price but also on non-price decisions. Not a case of dumping.

2008 A-Levels H2 Economics Case Study

Given this situation, it would indeed be difficult for USA to fully benefit from globalization. Extent of increase in demand for electricity is also related to absolute price differentials. UK government took steps to privatise the energy market.

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