i

ASSESSMENT BRIEF
Title and Code of Minor Award: Economics 5N1350
Class: BC1, BC2, BCL, BCF, ML1, ML2, LAC
Title: Microeconomics
Assessment No. and Technique: #1 Assignment Weighting (%): 30%
Issue Date: 24th October 2022 Submission Date: 12th December 2022
Feedback Date: Teacher Name: Kara Cramp

Learning Outcomes: 2, 8, 12, 13, 14

Learner Name (Print): Britney Stewart

I confirm that I have kept a copy of my work and that this is my own original work.
Signature: Britney Stewart

Assessment Criteria Max. Mark Learner Mark

Relevant information collected and appropriately presented 5
Understanding and knowledge of microeconomic concepts and theories clearly 20
demonstrated and appropriately applied.
Comprehensive evaluation of topic completed 5
Subtotal 30
Marks deducted for Late Submission:

Total Mark: Mark is provisional and subject to change by the external authenticator.

Teacher Feedback: It is the learner’s responsibility to be in class when feedback is being given.

Strengths:

Areas for improvement:

Page 1 of 17
Presentation Guidelines:
Complete the booklet and fully-word process the document.
Graphs can be hand-drawn and inserted as images, or other software can be used to insert graphs,
some may be referenced from digital sources if necessary and inserted as an image-all must be
referenced, full marks will be only awarded for graphs completed by the student.
Reference throughout the document and at the end with a bibliography-use Harvard Referencing style
should be used.
The brief cover page and marking scheme are to be attached to the front of the assignment.

Context:
“For an economy to function, producers must supply the goods that consumers
want. ‘Supply’ refers to the amount of goods a market can produce, while
‘demand’ refers to the amount of goods consumers are willing to buy. Together,
these two powerful market forces form the main principle that underlies all
economic theory”
http://www.whatiseconomics.org/the-law-of-supply-and-demand/
For this assignment you are asked to show your understanding and knowledge of
microeconomic theory and concepts by applying these theories to a chosen
economic good (product or service). Use the same good throughout the
assignment.

Introduction
Pick a good to do your assignment on. The good can be a product or a service.
Give details of your chosen good; include details such as: price, size, possible
substitutes and/or complements, marketing/advertising campaigns. In all of the
questions you need to apply micro-economic theory to your chosen good.

Page 2 of 17
 Tasks:
Learning Outcome 2
Examine the key factors determining supply and demand and their impact on market price
and production
Learning Outcome 12
Construct demand and supply curves
Demand
1. a) State and explain the Law of Demand (Investopidea, n.d.)
Economics involves the study of how people use limited resources to fulfil
their unlimited needs, loved him and focuses on these unlimited needs of
people. The law of demand is a fundamental principle of economics that
states that
“at higher chargers, buyers will demand a lower amount of products.”
move
Formula for law of demand is stated below,
Qx = f(Px;Y)

b) List and explain FOUR factors that may affect demand for your good
Demand of a good can have an affected by different factors like (Nielseniq,
n.d.)
1. price of product
Price is one of the most impactful factor as higher prices
generate low demand and low prices leads to higher
demand which is all because of consumers satisfaction as if
they can't afford any product there won't be much demand's
of the product.
2. availability of substitutes
There is always substitute in market regardless of what people
are selling so knowing who is your competitor is one of the big
thing as they can take over your place if yourn’t careful. things
like price cap which means what's the price of your product
and what is the price of same product in the market and
distribution that if the rest of the market is offering more items
in same product line and how huge is the availability of that
product?
3. Consumer's expectation

Page 3 of 17
 Consumer’s expectation is a bit hard pit as you never know
what to expect say during pandemic people bought a lot of
hand sanitizers masks and toilet papers but before pandemic it
was difficult to predict such expectations the only way we can
expect it is by taking in view past data to figure out what can
happen in future.
4. Consumer's income
Consumer's income is also a factor in market as more money
consumers have they are more likely to spend and buy more
stuff however it also depend on conditions as people are less
likely to spend in a recession than in a boom.
2. a) Explain the difference between a movement along the demand curve and a
shift in a demand curve
The movement along demand curve and a shift in demand curve represents
different factors such as movement along a demand curve is usually due to
a change of prices of particular good however a shift in a demand curve
represent variables like price of substitute goods, consumer’s income and
other changes.
b) Use a diagram to clearly show a movement along the demand curve

c) What will cause a shift to the right of the demand curve for your good? –
give two examples
The curve shift to the right means the latest a moral demand of your
code or service without any change of price this is indication of
economy booming or the buyers income is increased, which means
consumers will buy more even though the price is not changed. For
example,
Page 4 of 17
 1. expectations for future price increasing
2. Consumers preference about a particular product.
d) Use a diagram to clearly show and explain a shift to the right in the
demand curve.
Looking at the picture attached below it can be seen if the P is price,
Q is quantiy then shift to right indicates quantiy Q is demanded more
which shifts curve to right resulting in quantity Q1 to increase
demand at same price.

e) What will cause a shift to the left of the demand curve for your good? –
give two examples
A shift to the left of demand curve is inversely proportional shift in
the right curve which means if there will be a shift to the left of
demand curve there is a drop off demand of a particular product
which means that product is now purchased less of everything even
though price is the same. For example,
1. expectations for future price increasing
2. Consumers preference about a particular product.

f) Use a diagram to clearly show and explain a shift to the left in the demand
curve.
Looking at the picture attached below it can be seen if the P is price,
Q is quantiy then shift to left indicates quantiy Q is demanded less
which shifts curve to left resulting in quantity Q1 to decrease demand
at same price. (theBalanceMoney, n.d.)
Page 5 of 17
Supply
3. a) State and explain the Law of Supply (investopedia, n.d.)
Law of supply has a great importance in microeconomics this law states
that as price of an item increase, the quantity that a supplier provides
increases as well and vice versa. Which means dash if the price goes up
supplier will attempt maximise their profit by increasing the number of
item to be sold.
b) List and explain FOUR factors that may affect supply for your good. (abivin,
n.d.) (OpenLib, n.d.)
Supply of a good can have an affected by different factors like
1. Price
Price is one of the main factor which can affect supply of any good
usually a rise in the price of a product is because supply will drop
which will result in increase of price so the supplier can gain more
profit in the future also it indicates that if price is expected to drop
display supply would strongly increase in the market.
2. Cost of Production
Increase in cost of production results in shrinking supply of the
product. for example because of high rate of labour and poor natural
Page 6 of 17
 conditions like crop failures and increase in raw material prices etc
increases the cost of production while in such case manager of the
company would either supply a smaller quantity or they will stock up
till the market prices goes up.
3. Technology
Shift in supply curve is also because of technology advancement that
reduced cost of production however they can improve production
efficiency and hence cuts off cost spent for production. For example
a huge computer which was used who caused several thousand
euros can now he purchased in few hundred euros In that case
supply of computer is much higher as of past.
4. Government’s policies
In today's market government has a huge influence on supply of
products for example with lower taxes there will be a higher supply
of a product however if there are strict regulations the product
supply would fall.
4. a) What will cause a movement along the supply curve for your good? – give
one example
Change in price usually causes movement along the supply curve which is
also known as change in quantity supplied for example if the price goes up
from $6 per euro to $7 per pound then total quantity supplied goes up
from 25 million pound per month to 30 million pound per month.
b) Use a diagram to clearly show a movement along the supply curve

Page 7 of 17
 c) What will cause a shift to the right of the supply curve for your good? –
give two examples
Shift to the right of supply curve means an increase in number of sellers
supplying a good which is the supply curve shifting to right let's say a fall in
number of sellers in an industry of coffee shops changes the coffee
available at each price and so it changes supply.
for example
1. increase or decrease in number of sellers
2. High prices
d) Use a diagram to clearly show a shift to the right in the supply curve.

Page 8 of 17
 e) What will cause a shift to the left of the supply curve for your good? – give
two examples
In an event if the quantity supplied is reduced the supply curve shift to the
left for example an increase in production costs and excessive rain which
yields from coffee plants are example of such events which can cause
reduced supply which is mentioned or illustrated below in diagram
f) Use a diagram to clearly show a shift to the left in the supply curve.

Learning Outcome 8
Analyse the impact of a variety of changes in supply, demand, and market equilibrium.
Equilibrium
5. a) Draw a diagram of the market for your good in equilibrium.
Show and explain the effects on price, quantity demanded and quantity
supplied when the demand curve shifts to the right (2012Books, n.d.)

Page 9 of 17
 Diagram equilibrium price in any market is the price that wish amount of
quantity demanded is equal to amount of quantity supplied when I free to
the picture above the equilibrium in the market for coffee is $6 per pound.
However if we look the picture below an increase in demand for coffee shift
the demand curve to the right side to the equilibrium price rise to $7 per
pound this price will rise to the new equilibrium level the quantity supplied
will also increase to £30 million of coffee per month.

b) Draw a diagram of the market for your good in equilibrium.

Show and explain the effects on price, quantity demanded and quantity
supplied when the demand curve shifts to the left
Below graph shows a decrease in demand which will shift the demand
curve towards the left and in colibrium price falls to $5 per pound so as
price falls to the new equilibrium level the country supplied decreases to 20
million pounds of coffee per month.

Page 10 of 17
Elasticity
6. a) Briefly explain what is meant by the term ‘Price Elasticity of Demand’
The term late last year from and is the proportional change in quantity
demanded of a good divided by the percentage change in the price.
b) Do you think that demand for your good is likely to be price elastic or price
inelastic? Explain your answer. Include reference to the factors affecting
price elasticity of demand in your answer
Coffee is one of the things which is widely available at the level of
buyer’s expectations. the fact that the product is sold by many different
suppliers of course in a competitive market and a combination of low prices
irrespective of buyers spending power makes the demand of coffee highly
elastic.
Learning Outcome 13

Calculate marginal, average, and total costs.

Costs
7. Outline a fixed and variable costs the sellers would have come across
when selling your chosen product?
In business of coffee fixed costs might include rent, coffee machine maintenance,
milk, coffee purchase set an however variable costs are the one that will vary with
the output let's say the variable costs combined with the labour ratios these are
often the main drivers that'll determine if the coffee shops making profit or not in
most of the cases

Page 11 of 17
8. The table below shows the short run production costs for a small firm
producing a product.
Complete the cost calculations in the table.

 Output Total Fixed Total Total Average Marginal

Costs (TFC) Variable Cost Cost Per Cost
Costs (TVC) Unit
0 200 0 200 0 0
50 200 400 600 12 3
100 200 750 950 9.50 4.75
150 200 1200 1400 9.33 7.25
200 200 1800 2000 10.00 10
250 200 2500 2700 10.8 14

Learning Outcome 14
Critically evaluate a variety of market structures, such as perfect competition, imperfect competition,
monopoly, and oligopoly.

Markets
9. Which market structure (perfect competition, monopolistic competition,
oligopoly or monopoly) applies to your chosen good?
Write 3 bullet points justifying your choice of market structure.
The coffee shop there's sales a well known global brand would be our monopolistic
competitive business because
 coffee shop can has close substitutes
 coffee sold by each business is completely different table
 And the market is easily accessible

10.Compare TWO market structures of your choice under the following headings:
 the number of firms in the market (onlineAurora, n.d.)
first I would like to mention about oligopoly no it is
dominated by a few firms with a little competition
sorting in collaborating or competing against each other
for their collective good and to earn more profit,
secondly I would like to mention about monopoly a
monopoly exist when there's a single firm which controls
the entire market and the form is sold producer of a
product and there are no close substitutes.
 the firm’s influence over price
Page 12 of 17
 first I would like to mention about oligopoly in such
markets structure but I think profits and their
production level changes as the dynamic relationship
between sellers and buyers changes secondly I will
mention monopoly where these firms can set their own
prices and as there are no close substitutes they can still
keep control of their prices I can make a good profit if
they want.
 the nature of the product – differentiated or undifferentiated
firstly in oligopoly it could either be differentiated or
undifferentiated depending on type of the products just
selling for example Microsoft services are
undifferentiated secondly I would like to mention about
monopoly which is undifferentiated ask to play on
higher scales
 ease of entry into the market
first I would like to mention about oligopoly there it's
difficult to enter end as the most powerful companies
have control over raw materials and the physical
resources which can create barriers for potential entries
secondly in monopoly entry is blocked.
 real-life example
firstly I would like to mention the example of oligopoly
the companies like Microsoft, Google or dominating the
market other examples could be automobile industries
secondly in monopoly example could be professional
sports leagues and bus services et cetera.

References
Page 13 of 17
2012Books, n.d. 2012Books. [Online]
Available at: https://2012books.lardbucket.org/books/microeconomics-principles-v2.0/s06-03-
demand-supply-and-equilibrium.html

abivin, n.d. abivin. [Online]

Available at: https://www.abivin.com/post/5-factors-that-affect-supply

investopedia, n.d. investopedia. [Online]

Available at: https://www.investopedia.com/terms/l/lawofsupply.asp

Investopidea, n.d. Investopidea. [Online]

Available at: https://www.investopedia.com/terms/l/lawofdemand.asp

Nielseniq, n.d. Nielseniq. [Online]

Available at: https://nielseniq.com/global/en/insights/analysis/2022/7-factors-that-influence-the-
demand-of-consumer-goods/#niq-tab-2

onlineAurora, n.d. onlineAurora. [Online]

Available at: https://online.aurora.edu/types-of-market-structures/

OpenLib, n.d. OpenLib. [Online]

Available at:
https://open.lib.umn.edu/app/uploads/sites/180/2016/05/1a49b1fdc4f96030093280e1b016aee3.jp
g

theBalanceMoney, n.d. theBalanceMoney. [Online]

Available at: https://www.thebalancemoney.com/shift-in-demand-curve-when-price-doesn-t-
matter-3305720

***End of document***

Page 14 of 17
 Marking Scheme for Micro Economics Assignment (30%)

Learner Name: _______Kara Cramp__________________________________________

Maximum Marks Learner Mark

Relevant information collected and appropriately presented (5 marks)

 Well-structured assignment
2 marks
1 mark for layout and 1 mark for diagrams
 Relevant information collected
1 mark for introduction 2 marks
1 mark for other research (FC/VC)
 Citation and Referencing 1 mark

Understanding and knowledge of micro economic concepts and theories clearly demonstrated and
appropriately applied (20 marks)
 Law of Demand 1 mark

 4 factors affecting demand – 0.25 marks each 1 mark

0.5 mark cause
 Movement along a demand curve
0.5 mark diagram
 Explain 2 factors which may lead to a shift to right in the
1 mark
demand curve – 0.5 marks each
 Diagram (shift to the right) 1 mark diagram
 Explain 2 factors which may lead to a shift to left in the
1 mark
demand curve.
 Diagram (shift to the left) 1 mark diagram

 Law of Supply 1 mark

 4 factors affecting supply – 0.25 marks each 1 marks

0.5 diagram
 Movement along the Supply curve
0.5 mark cause
 Explain 2 factors which may lead to a shift to right in the
1 mark
supply curve. – 0.5 each
 Supply Diagram (shift to the right) 1 mark diagram
 Explain 2 factors which may lead to a shift to left in the
1 mark
supply curve.
 Supply Diagram (shift to the left) 1 mark diagram
 Equilibrium 2 diagrams
0.5 per diagram and 0.5 to explain effects on P and Q for 2 marks
each of 2 diagrams
 Cost Table Completion 16 x 0.25 4 marks

Comprehensively evaluate the subject matter (5 marks)

 Reasoning/Evaluation of Price Elasticity of Demand (Q6) 2 marks

Page 15 of 17
 Paragraph on the choice of market structure (Q9) 1 mark

 Market Structure Comparisons (Q10) 2 marks

Page 16 of 17
i