DQS156 -PRINCIPLES OF ECONOMICS

INDIVIDUAL PROJECT –10%

REPRODUCE calculations on market equilibrium, elasticity of demand and supply and national income,
related to quantity surveying practice.

QUESTION 1

a) Based on the table given, calculate the degree of elasticity of demand for these goods.

Good % Price Increase % Quantity demanded Degree of elasticity

falls

A 20 10

B 40 50

C 30 0

D 20 60

The table below shows the relationship between the price of good X and the quantity

demanded for good Y and Z.

Price of Good X (RM/unit) Quantity Demanded (Good Y) Quantity Demanded (Good Z)

(units) (units)

11 50 10

10 P1 46 Q1 18 Q1

9 P0 40 Q0 22 Q0

8 37 26

b) Calculate the cross elasticity of demand for good Y and Z when the price of good X rises

from RM9.00 a unit to RM10.00 a unit.

c) State the relationship of the respective goods.

i. X and Y

ii. X and Z
TOTAL-3 MARKS

RUBRICS

3–All the calculation is complete; the answer is correct and submit on time.

2–Most of the calculation is complete;most of the answer is correct and submit on time.

1–Some of the calculation is complete;some of the answer is correct and late submission.

QUESTION 2

The following table shows demand and supply schedules for coconut in Perak.

Price (RM/unit) Quantity demanded (units) Quantity supplied (units)

1.00 150 600

0.80 250 400

0.70 300 300

0.50 450 200

0.30 500 100

Based on the table above, answer the following questions.

a) On the graph paper provided, plot the demand and supply curve for coconut in Perak.

b) State the equilibrium price and quantity.

c) Assuming the legal price for coconut is established at RM0.50. This legal price is called
__________________. State the disequilibrium problem that prevailed in the market.

d) Assuming the government decided to change the legal price of coconut from RM0.70

to RM1.00 per unit.

(i) On the same graph paper, show whether there would be a problem of shortage

or surplus and how much it would be.

(ii) Name the price control imposed by the government.

TOTAL-3 MARKS
RUBRICS

3–All the calculation is complete;the answer is correct and submit on time.

2–Most of the calculation is complete;most of the answer is correct and submit on time.

1–Some of the calculation is complete;some of the answer is correct and late submission.

QUESTION 3

The table shows national income data for a country with a population of 10 million people.

ITEMS RM million

Private domestic investment I 23,000

Transfer payment 10,000

Government expenditure G 35,000

Public consumption 15,000

Exports X 17,000

Indirect tax 12,000

Private consumption C 38,000

Imports M 19,000

Change in stock I -10,000

Subsidies 8,000

Depreciation 6,000

Corporate profits 24,000

Net factor income from abroad 20,000

Calculate:

a) Gross domestic product at market price. C + I + G + X - M

b) Gross national product at market price. GDPmp + net factor income from abroad

c) National income. GNPmp - indirect tax + subsidies - depreciation

d) National income per capita. NI ÷10 million people

e) List two (2) uses of calculating national income.

TOTAL-4 MARKS

RUBRICS

4–All the calculation is complete;the answer iscorrect and submit on time.

3–Most of the calculation is complete;most of the answer iscorrect and submit on time.

2–Someof the calculation is complete;some of the answer iscorrect and late submission.

1 –little of the calculation is complete;little of the answer is correct and late submission.

TOTAL 10 marks