Week 1
Lecture 1: Demand Analysis
1. What is the purpose of the EU's transport policy as described in the lecture?
2. Explain Simon Sinek's "Golden Circle" model and its relevance to transport
policy.
3. Why is it important for firms to estimate demand functions?
4. What is inverse demand, and why is it significant for policymakers?
5. List the factors that influence the demand for transportation services.
6. Define and explain the concept of elasticity in demand analysis.
7. What was the mean price elasticity of aviation demand based on Brons et al.
(2002)?
8. How does the proportion of consumer expenditure influence price elasticity?
9. How is consumer welfare measured in relation to the inverse demand curve?
10. What factors drive the demand function Q=f(P,Y,t)Q=f(P,Y,t) as mentioned in the
lecture?
Lecture 2: Cost Functions
1. What are the key factors of production in a transport company?
2. Explain how a cost function is derived from a cost minimization problem.
3. What is the di[erence between fixed costs and variable costs in a transport
company?
4. Define marginal cost and its significance in the context of transport companies.
5. Explain the concept of economies of scale and how it is determined using
marginal and average costs.
6. How does the Cobb-Douglas cost function represent total cost?
7. What is the economic meaning of ∂TC/∂Q in a Cobb-Douglas cost function?
8. What are economies of density, and how are they estimated?
9. Provide examples of technical and managerial economies of scale in the
transport industry.
10. What is the translog specification, and how does it di[er from the Cobb-Douglas
cost function?
,Week 2
Lecture 3: Market Structures
1. What are the di[erent market structures discussed in the lecture?
2. How does a producer's revenue change as a result of a marginal change in
output?
3. Explain the concept of profit maximization and its significance in economic
theory.
4. How does managerial utility maximization di[er from profit maximization?
5. What are some alternative strategies to profit maximization mentioned in the
lecture?
6. Define perfect competition and list its key characteristics.
7. How does a monopolist determine the price and output level?
8. What is the role of marginal revenues in determining the output of a monopolist?
9. What is Cournot competition, and how do firms behave in such a model?
10. Explain Bertrand oligopoly and how it leads to price competition between firms.
Lecture 4: Competition Policy, Regulation, and Privatization
1. What are the necessary conditions for price discrimination to occur?
2. Define first-degree price discrimination and provide an example.
3. How does second-degree price discrimination work in terms of consumer self-
selection?
4. Explain third-degree price discrimination and give an example from the transport
sector.
5. What is the purpose of competition policy, according to the lecture?
6. Describe the SSNIP test and its role in market regulation.
7. What is the problem with using linear inverse demand functions in regulatory
decisions?
8. Explain the concept of rate-of-return regulation and its potential downsides.
9. What is price-cap (CPI-X) regulation, and how does it incentivize firms?
10. Discuss the political and economic arguments for and against privatization and
deregulation.
, Week 3
Lecture 5: Externalities
1. Define an externality and provide an example from the transport sector.
2. What is the di[erence between marginal social cost (MSC) and marginal private
cost (MPC)?
3. How does a missing market contribute to ine[iciency in the context of
externalities?
4. Explain the welfare loss caused by externalities in a transport market.
5. How can tolls be used to correct for negative externalities, and what is the
optimal toll amount?
6. What is the role of cap-and-trade systems in managing externalities, and how do
they work?
7. Provide an example of cap-and-trade in the transport or energy sectors.
8. What is the “rule of half” and how is it applied to welfare analysis in the presence
of externalities?
9. Discuss the role of government intervention in managing externalities related to
congestion and pollution.
10. What are the potential outcomes of negotiations between two parties when
dealing with externalities, as explained by the Edgeworth box model?
Lecture 6: Project Appraisal
1. What is the basic idea of Cost-Benefit Analysis (CBA), and how is it applied to
transport projects?
2. Explain the concept of Net Present Value (NPV) and its role in project appraisal.
3. What are some of the key benefits considered in transport project appraisals?
4. How does the "rule of half" apply to measuring consumer surplus in transport
improvements?
5. What are some of the wider economic e[ects considered in a CBA?
6. Why is sensitivity analysis important in the context of CBA for transport projects?
7. Discuss the potential sources of uncertainty in project appraisal, particularly in
large infrastructure projects.
8. What are the typical costs considered in transport CBAs?
9. Explain how external costs are factored into a CBA and provide an example from
a transport project.
10. What role does CBA play in policy preparation, and why might a project with a
negative NPV still be implemented?
Lecture 1: Demand Analysis
1. What is the purpose of the EU's transport policy as described in the lecture?
2. Explain Simon Sinek's "Golden Circle" model and its relevance to transport
policy.
3. Why is it important for firms to estimate demand functions?
4. What is inverse demand, and why is it significant for policymakers?
5. List the factors that influence the demand for transportation services.
6. Define and explain the concept of elasticity in demand analysis.
7. What was the mean price elasticity of aviation demand based on Brons et al.
(2002)?
8. How does the proportion of consumer expenditure influence price elasticity?
9. How is consumer welfare measured in relation to the inverse demand curve?
10. What factors drive the demand function Q=f(P,Y,t)Q=f(P,Y,t) as mentioned in the
lecture?
Lecture 2: Cost Functions
1. What are the key factors of production in a transport company?
2. Explain how a cost function is derived from a cost minimization problem.
3. What is the di[erence between fixed costs and variable costs in a transport
company?
4. Define marginal cost and its significance in the context of transport companies.
5. Explain the concept of economies of scale and how it is determined using
marginal and average costs.
6. How does the Cobb-Douglas cost function represent total cost?
7. What is the economic meaning of ∂TC/∂Q in a Cobb-Douglas cost function?
8. What are economies of density, and how are they estimated?
9. Provide examples of technical and managerial economies of scale in the
transport industry.
10. What is the translog specification, and how does it di[er from the Cobb-Douglas
cost function?
,Week 2
Lecture 3: Market Structures
1. What are the di[erent market structures discussed in the lecture?
2. How does a producer's revenue change as a result of a marginal change in
output?
3. Explain the concept of profit maximization and its significance in economic
theory.
4. How does managerial utility maximization di[er from profit maximization?
5. What are some alternative strategies to profit maximization mentioned in the
lecture?
6. Define perfect competition and list its key characteristics.
7. How does a monopolist determine the price and output level?
8. What is the role of marginal revenues in determining the output of a monopolist?
9. What is Cournot competition, and how do firms behave in such a model?
10. Explain Bertrand oligopoly and how it leads to price competition between firms.
Lecture 4: Competition Policy, Regulation, and Privatization
1. What are the necessary conditions for price discrimination to occur?
2. Define first-degree price discrimination and provide an example.
3. How does second-degree price discrimination work in terms of consumer self-
selection?
4. Explain third-degree price discrimination and give an example from the transport
sector.
5. What is the purpose of competition policy, according to the lecture?
6. Describe the SSNIP test and its role in market regulation.
7. What is the problem with using linear inverse demand functions in regulatory
decisions?
8. Explain the concept of rate-of-return regulation and its potential downsides.
9. What is price-cap (CPI-X) regulation, and how does it incentivize firms?
10. Discuss the political and economic arguments for and against privatization and
deregulation.
, Week 3
Lecture 5: Externalities
1. Define an externality and provide an example from the transport sector.
2. What is the di[erence between marginal social cost (MSC) and marginal private
cost (MPC)?
3. How does a missing market contribute to ine[iciency in the context of
externalities?
4. Explain the welfare loss caused by externalities in a transport market.
5. How can tolls be used to correct for negative externalities, and what is the
optimal toll amount?
6. What is the role of cap-and-trade systems in managing externalities, and how do
they work?
7. Provide an example of cap-and-trade in the transport or energy sectors.
8. What is the “rule of half” and how is it applied to welfare analysis in the presence
of externalities?
9. Discuss the role of government intervention in managing externalities related to
congestion and pollution.
10. What are the potential outcomes of negotiations between two parties when
dealing with externalities, as explained by the Edgeworth box model?
Lecture 6: Project Appraisal
1. What is the basic idea of Cost-Benefit Analysis (CBA), and how is it applied to
transport projects?
2. Explain the concept of Net Present Value (NPV) and its role in project appraisal.
3. What are some of the key benefits considered in transport project appraisals?
4. How does the "rule of half" apply to measuring consumer surplus in transport
improvements?
5. What are some of the wider economic e[ects considered in a CBA?
6. Why is sensitivity analysis important in the context of CBA for transport projects?
7. Discuss the potential sources of uncertainty in project appraisal, particularly in
large infrastructure projects.
8. What are the typical costs considered in transport CBAs?
9. Explain how external costs are factored into a CBA and provide an example from
a transport project.
10. What role does CBA play in policy preparation, and why might a project with a
negative NPV still be implemented?
