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导读:这是一篇英国留学生Introductory Economics的Coursework范文。
Answers 3 questions 回答3个问题
Each question is worth equal marks
Each answer should be a maximum of 700 words with diagrams (if necessary) .每个答案最多应包含700个单词（如有必要）
1. Show a shift supply and explain what factors can lead to this situation.显示班次供应并解释可能导致这种情况的因素
2. Explain and illustrate the concept of perfect competition?解释并说明完全竞争的概念
3. Is economic growth good for society?经济增长对社会有益吗
1. Show a shift supply and explain what factors can lead to this situation
经济学家中的供给曲线是指以图形方式表示供应量与收取的价格之间的关系的曲线。 水平绘制供应，同时垂直绘制价格。 供给是指公司，制造商，金融资产提供者或其他经济主体愿意以各种给定价格向市场提供的每单位时间或劳动力的产品或服务数量，而所有其他因素保持不变。
例如，完全竞争市场中供给曲线的变化可能由各种原因引起，除了价格变化：技术状态，其他商品的价格，供应商的数量，政府补贴和税收。 为了实现轮班供应，价格和所有其他决定因素应保持不变。
以下是供应曲线偏移的示例，每个决定因素都有变化。
A supply curve in Economist refers to the curve that graphically represents the relationship between the amount supplied and the price charged. Supply is plotted horizontally while the price is plotted vertically. Supply refers to the amount of products or services per unit of time or labor that companies, manufacturers, financial assets providers or other economic agents are willing to provide at all various given prices to the market while all other factors are held at constant.
A shift in supply curve in a perfect competitive market, for example, can be caused by various reasons except for a change in price: the state of technology, the price of other commodities, the number of suppliers, government subsidies and taxation. For a shift supply to happen, the price and all other determinants should remain constant.
Here are examples of supply curve shift with changes in each determinants.
a. A Change in the State of Technology
For example, assuming a company is producing computer chips and have just adopted a new technology to increase the rotation rate for its manufacturing machine so that more chips can be produced per unit of time. In this case, the supplies will increase without an increase in price because the firm assumes that more value will be created from the new technology even with the cost of the new technology counted. Thus, the supply curve will shift downward to the right with an increase in technology.
b. Changes in the Price of Other Commodities
Changes in other commodities can also affect the product's supply curve. The price of substitute and complementary commodities can have an effect on the supply of the product in a specific case. For example, for a CD disk production company, an increase for the average market price of the CD players would cause the demand for CD disk to decrease because of a decreased demand for its complementary commodities. A decreased demand would result in a decreased supply. Customers would willing to pay less for the product while all other determinants remain the same. The supply curve would shift downward to the right.
On the contrary, an increase for the price of the substitute product would cause the target product's supply curve shift upward to the left. In our case still, if the average market price for MP3 players increased, more customers would prefer CD disks to MP3 player if the price of CD disks remain the same. Thus, the supply of CD disks will increase at the same price level.
Another situation is that when a company produces a series of products, changes in one of the products' price would affect the supplies of others. For example, a company produces corn and rice at the same time, when the average market price for corn increased from $10 to $13 per 10 pounds and the price for rice remain the same, the company is opt to allocate more resources to produce corn and less of to the rice. In this case, the supply curve of rice would shift upwards if the price of corn increases and would shift downward if the price of corn decreases.
c. Changes in the Number of Suppliers
The entry of new firms in the market leads to an increased quantities and thus a fall for the price. The price remain constant and more products will be supplied. Thus, the supply curve would shift downward to the right with the number of suppliers increased.
d. Government Subsidies and Taxation.
If the government offers a favorable taxation rule for the product, the product cost increases, leading to an increase in supply. Thus, the supply curve would shift downward to the right. Government subsidies reduce the cost of production and thus increase the supply on the market, leading to a downward shift of the supply curve to the right.
2. Explain and illustrate the concept of perfect competition
Perfect competition refers to a market where no participants are large enough to have the market power to affect the pricing of a specific product it buys or sells. In a perfect competitive market, all participants is a price taker and all competitions are fully exercised. Due to the strictness of the conditions for a perfect competition, few of the markets qualified. For buyers and sellers in auction-type markets such as commodities or financial assets, the condition might approximate the concept. A perfect competitive market exercises a Pareto efficient allocation of economic resources as also serves as a bench mark against other markets: monopoly, monopolistic competition, and oligopoly.
Structural Characteristics for a Perfect Competitive Market
a. A large number of buyers and sellers
There is a large number of buyers and sellers with the willingness and ability to purchase and produce products at a certain price.
b. Homogeneous Product
Each firm produces and sells a homogeneous product
c. Perfect Information
Each buyers and sellers have relevant information concerning the price, conditions and qualities for the product
d. Perfect Determinant Mobility
All determinants for the production are perfectly mobile in the long run and apt for adjustment for external changes.
e. No Barriers of Entry and Exit
It's extremely easy for a firm to enter or exit the market and there is no cost related to entering or exiting the market
f. Zero Transaction Costs
No costs are incurred from buyers or sellers in any transactions for exchange of products
g. Profit Maximization
All sellers are expected to sell at the marginal profit to earn the maximization of profit.
h. Economies of Scale
Since the perfect competitive have achieved economies of scale, there will always be enough participants in the market
I. Property Rights
Any transactions in a perfect competitive market possesses a clear arrangement of property rights.
j. Rational Buyers
All buyers are able to make wise and rational purchase decisions based on available information in the market
k. No Externalizations
Any costs incurred or gains obtained from transactions doesn't involved a third party.
Theories from Neoclassical Economics
There are basically two strands of theories for the definition of perfect competitive markets in neoclassical economics. The first emphasize on the inability of any one participants to affect the price. According to Aumann (1964), each participants is too small to have an effect on the equilibrium price.
The second emphasize that agents would take advantage and eliminate the profitable exchange opportunities immediately due to the condition that a perfect competitive market reacts instantaneously to make the supply equate demand after any arbitrage. Although Walrasian auctioneer's model is in support of this point and can prove that prices mechanism always works in a perfect competitive market, it is rejected by scholars like Mas-Colell et al( 1995) and Steve Keen. According to Steve Keen (2001). if firms do not react strategically to each other and the market is not even in a perfect competitive situation, the slope of the demand curve faced by a firm may still equals the slope of the market demand curve. In this case, a perfect competitive market must include an infinite number of firms for each of them to produce at the marginal price and revenue. However, in reality, only a small amount of firms are acting as participants to the market. Thus, the current pricing theories for perfect competitive is a combination of several notions, each taking a different weight of importance. |
