ECS1501
ASSIGNMENT NO 5 , 2024
, ECS1501 - Assessment 5.2024
Question 1 (12 marks) Maximum word count: 100 words
(i) In the podcast episode, presenter Alex describes the market
condition that Giant Bicycles faces as being in a state of oversupply. He
explains that with the decrease in pre-tax profit and sales, it is likely
that Giant has produced more bicycles than there is demand for in the
market. I agree with this assessment because a decrease in profit and
sales suggests that there is excess supply in the market, leading to a
decrease in prices and profitability for Giant.
(ii) Diagram of the bicycle market:
Quantity
^
|
S |
o |
|
u | D
p | o
p | l
l | l
y | a
| r
| Quantity
|
In this diagram, the supply curve (S) represents the quantity of bicycles
that Giant produces and is willing to sell at various price levels. The
demand curve (D) represents the quantity of bicycles that consumers
are willing to buy at different price levels. The intersection of the supply
and demand curves represents the market equilibrium where the
quantity supplied equals the quantity demanded.
ASSIGNMENT NO 5 , 2024
, ECS1501 - Assessment 5.2024
Question 1 (12 marks) Maximum word count: 100 words
(i) In the podcast episode, presenter Alex describes the market
condition that Giant Bicycles faces as being in a state of oversupply. He
explains that with the decrease in pre-tax profit and sales, it is likely
that Giant has produced more bicycles than there is demand for in the
market. I agree with this assessment because a decrease in profit and
sales suggests that there is excess supply in the market, leading to a
decrease in prices and profitability for Giant.
(ii) Diagram of the bicycle market:
Quantity
^
|
S |
o |
|
u | D
p | o
p | l
l | l
y | a
| r
| Quantity
|
In this diagram, the supply curve (S) represents the quantity of bicycles
that Giant produces and is willing to sell at various price levels. The
demand curve (D) represents the quantity of bicycles that consumers
are willing to buy at different price levels. The intersection of the supply
and demand curves represents the market equilibrium where the
quantity supplied equals the quantity demanded.
