Part 1

Objective

This assignment aims to deepen students’ understanding of economic systems and market dynamics. Part A covers Malaysia’s mixed economic system, durian market analysis including supply, demand, and price controls, along with elasticity calculations. Part B focuses on various market structures, requiring analysis of monopolistic competition, oligopoly, and firm-specific profit strategies. The goal is to enhance practical application of economic theories in understanding market behaviors and firm decision-making.

Requirements

PART A:

QUESTION 1

Malaysia   practices   a   mixed   economic   system.   Discuss   the   characteristics   of   this  economicsystem from your own observations of the economic activity in Malaysia

QUESTION 2

a) Plot the market demand and supply curves for durian based on the information provided.            
                                                                                                                     
b) Determine the market equilibrium price and quantity for demand    
         
c) Suppose the government imposed USD 4 as the price control                              

       i. what is the price control implemented by the government        
                   
       ii. Determine whether there will be a surplus or shortage of durian in the market      

       iii. Calculate the amount of surplus or shortage        

d) Show   the   effects   of   the   following   factors   on   the   market   for   durian   using   a   separatediagram

         i.       The government increased the subsidy given to durian producers          

         ii.      The preference for durian among consumers increased                    

        iii.    The durian season has ended  

QUESTION 3

a) Using the midpoint method, calculate the price elasticity of demand when the price of a T-shirtrises from $5 to $6 and the average tourist income is $20,000. Also calculate it when theaverage tourist income is $30,000.

b) Using the midpoint method, calculate the income elasticity of demand when the price of a T-shirt is $4 and the average tourist income increases from $20,000 to $30,000. Also calculate itwhen the price is $7.

c) Using the cross elasticity of demand, calculate as follow:

      i. James   buys   10   watermelons   if   the   price   is   RM2.00   per   fruit.   When   the   price   of   thewatermelon increases to RM2.50, the quantity bought by James is 6 fruits. Calculate theelasticity of price demanded.

       ii. The coefficient value for the price demanded is -1.2 when the price of books decreasesfrom RM10 to RM6. What is the percentage change in the quantity of books?

PART B:

QUESTION 1

a) Count and fill in the cost that is missing from the table above        

b) Which time periof is the firm operating in? why

QUESTION 2

Describe the short run profit-maximizing conditions of the monopolistically competitive firm. Illustrate your answer with suitable diagrams.

QUESTION 3

“An Oligopoly firm faces a kinked demand curve”. Discuss this statement using an appropriate diagram.

QUESTION 4

a) In which types of market structure is the firm operating?          

b) Calculate the profit maximizing quantity and price?            

c) Calculate the total profit at equilibrium output?              

d) What type of profit is earned by this firm?          

e) The shut-down price is __________________________.  

QUESTION 5

a) Calculate the profit maximizing price and output.

b) Arwin Bhd is operating in a _________________market          

c) Calculate the profit earned by the firm and explain the type of profit.          

d) Give TWO (2) of this type of market structure.

Part II

Online Class 

Discuss the following topic(s) in the forum and submit proof of your participation in the online discussions: