[meteor_slideshow slideshow=”arp1″]
You are expected to communicate effectively using appropriate economics terminology and models, usually in the form of diagrams which are incorporated into your discussion.
Read the following excerpts from the article ?Lambs lay a golden egg? by Tony Love published in the Advertiser on May 11th 2010 and answer questions 1, 2 and 3.
? This section is worth 20 marks. You should allow approximately 45 minutes.
? Answer all questions in your answer booklet.
Lambs lay a golden egg
?The price of Australia?s favourite meat has risen nine per cent in the past year. Industry analysts predict that prices will continue to rise as the livestock industry tries to satisfy rising overseas and domestic demand.
The average price for lamb cutlets in SA was $27.50 /kg in March 2010 compared to $15.95 in July 2006.
Regular marketing campaigns by Meat and Livestock Australia (MLA) have prompted Australians to buy more of their most popular roasts, cutlets and mince. Australians spent a record $2.3 billion on lamb last year, up 10% on the previous period according to the MLA. Lamb meat production in SA has jumped from 20,000 tonnes to 80,000 tonnes in the last five years.
At the same time global demand has risen causing an international shortage of sheep meat.
However, many farmers have reduced stock numbers over the last decade due to drought and others have switched their land to crops such as wheat and canola.
The current market is so buoyant that some farmers are hand-rearing dozens of baby lambs that are abandoned by their mothers and would normally be left to die, knowing that in spring when they are ready to sell that they will reap a handsome return.?
1.
Assume that the market for lamb is perfectly competitive. Using an appropriate model (or models) illustrate and explain
a. How a competitive market arrives at equilibrium (4 marks)
b. Why the price of lamb has risen? (4 marks)
2.
Discuss the factors that affect the price elasticity of demand as they apply to lamb and make a suggestion based on your appraisal as to the likely price elasticity coefficient. Conclude your answer with a brief explanation as to how price elasticity influences total revenue in the light of any price change. (4 marks)
3.
What sort of policies could the government implement to make lamb more affordable to the consumers? What are some problems associated with this policy? What solutions could the government implement to reduce the consequence? (8 marks)
Total = 20 marks —Minus 1 mark for plagiarism
References can be in the Economic principles book, website or from your knowledge.
[meteor_slideshow slideshow=”arp2″]
A-Research-Paper.com is committed to deliver a custom paper/essay which is 100% original and deliver it within the deadline. Place your custom order with us and experience the different; You are guaranteed; value for your money and a premium paper which meets your expectations, 24/7 customer support and communication with your writer. Order Now
Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.
[order_calculator]