Economics Department
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Economics Department |
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Max/min price essays
This week's essay
(a) Using a diagram, explain how a buffer stock scheme can partly stabilise the prices of primary products (10 marks) (b) Why might such a scheme eventually fail? (10 marks)
Other essays
1) If the rational consumer has a choice of goods, how does the concept of consumer surplus help to explain how that choice is made? (20 marks)
2) Explain, using diagrams, the impact of the following on consumer surplus, producer surplus and equilibrium. (i) A minimum wage set above the market clearing level for security guards (7 marks) (ii) A maximum price for cup final tickets, set below the market clearing level (7 marks) (iii) A Government guaranteed price for wheat set above the market clearing level (6 marks)
3) (a) With the aid of a diagram, Explain how a government guarantees prices to farmers above the market price for the good. (10 marks) (b) Discuss whether such intervention is likely to be beneficial from society’s point of view (10 marks)
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